Wright Prospecting Pty Ltd v Hancock Prospecting Pty Ltd [No 8]
[2016] WASC 361
•9 NOVEMBER 2016
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: WRIGHT PROSPECTING PTY LTD -v- HANCOCK PROSPECTING PTY LTD [No 8] [2016] WASC 361
CORAM: LE MIERE J
HEARD: 4 NOVEMBER 2016
DELIVERED : 9 NOVEMBER 2016
FILE NO/S: CIV 3041 of 2010
Consolidated with CIV 2617 of 2012 by Orders dated 9 September 2014
BETWEEN: WRIGHT PROSPECTING PTY LTD
Plaintiff
AND
HANCOCK PROSPECTING PTY LTD
First DefendantHOPE DOWNS IRON ORE PTY LTD
Second DefendantBIANCA HOPE RINEHART
Third DefendantJOHN LANGLEY HANCOCK
Fourth DefendantHOPE RINEHART WELKER
Fifth DefendantGINIA HOPE FRANCIS RINEHART
Sixth DefendantHAMERSLEY WA PTY LTD
Third Party
FILE NO/S :CIV 2617 of 2012
BETWEEN :WRIGHT PROSPECTING PTY LTD
Plaintiff
AND
HANCOCK PROSPECTING PTY LTD
First DefendantHOPE DOWNS IRON ORE PTY LTD
Second DefendantBIANCA HOPE RINEHART
Third DefendantJOHN LANGLEY HANCOCK
Fourth DefendantHOPE RINEHART WELKER
Fifth DefendantGINIA HOPE FRANCIS RINEHART
Sixth DefendantHAMERSLEY WA PTY LTD
Third Party
FILE NO/S :CIV 2737 of 2013
BETWEEN :DFD RHODES PTY LTD
First Plaintiff
MATTHEW JOHN KEADY AND DOROTHEA MARGARET CAMPBELL by chain of Executors, the Executors of the Estate of DONOVAN FRANCES DUNCAN RHODES
Second PlaintiffsAND
HANCOCK PROSPECTING PTY LTD
First DefendantWRIGHT PROSPECTING PTY LTD
Second DefendantHOPE DOWNS IRON ORE PTY LTD
Third DefendantBIANCA HOPE RINEHART
Fourth DefendantJOHN LANGLEY HANCOCK
Fifth DefendantHOPE RINEHART WELKER
Sixth DefendantGINIA HOPE FRANCIS RINEHART
Seventh DefendantHAMERSLEY WA PTY LTD
Third Party
Catchwords:
Practice and procedure - Programming orders - Whether applications should wait for determination of appeal in related proceedings in another court - Cross-vesting application - Stay application - Directions given - Turns on own facts
Legislation:
Commercial Arbitration Act 2010 (NSW)
Commercial Arbitration Act 2012 (WA), s 8(1), s 17J
Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth), s 5
Rules of the Supreme Court 1971 (WA), O 1 r 4A, O 1 r 4B
Result:
Directions given
Category: B
Representation:
CIV 3041 of 2010
Consolidated with CIV 2617 of 2012 by Orders dated 9 September 2014
Counsel:
Plaintiff: Mr A J Myers QC & Mr J Rowland QC
First Defendant : Mr J Giles SC & Mr C Bova
Second Defendant : Mr J Giles SC & Mr C Bova
Third Defendant : Mr T Price
Fourth Defendant : Mr T Price
Fifth Defendant : Mr M A Deutsch
Sixth Defendant : Mr J Dalzell
Third Party : Mr J Garas
Solicitors:
Plaintiff: Clayton Utz
First Defendant : Jackson McDonald
Second Defendant : Jackson McDonald
Third Defendant : Yeldham Price O'Brien Lusk
Fourth Defendant : Yeldham Price O'Brien Lusk
Fifth Defendant : Deutsch Miller
Sixth Defendant : Gadens Lawyers
Third Party : Allens
CIV 2617 of 2012
Counsel:
Plaintiff: Mr A J Myers QC & Mr J Rowland QC
First Defendant : Mr J Giles SC & Mr C Bova
Second Defendant : Mr J Giles SC & Mr C Bova
Third Defendant : Mr T Price
Fourth Defendant : Mr T Price
Fifth Defendant : Mr M A Deutsch
Sixth Defendant : Mr J Dalzell
Third Party : Mr J Garas
Solicitors:
Plaintiff: Clayton Utz
First Defendant : Jackson McDonald
Second Defendant : Jackson McDonald
Third Defendant : Yeldham Price O'Brien Lusk
Fourth Defendant : Yeldham Price O'Brien Lusk
Fifth Defendant : Deutsch Miller
Sixth Defendant : Gadens Lawyers
Third Party : Allens
CIV 2737 of 2013
Counsel:
First Plaintiff : Mr G E Taylor
Second Plaintiffs : Mr G E Taylor
First Defendant : Mr J Giles SC & Mr C Bova
Second Defendant : Mr A J Myers QC & Mr J Rowland QC
Third Defendant : Mr J Giles SC & Mr C Bova
Fourth Defendant : Mr T Price
Fifth Defendant : Mr T Price
Sixth Defendant : Mr M A Deutsch
Seventh Defendant : Mr Dalzell
Third Party : Mr J Garas
Solicitors:
First Plaintiff : G E Taylor & Associates
Second Plaintiffs : G E Taylor & Associates
First Defendant : Jackson McDonald
Second Defendant : Clayton Utz
Third Defendant : Jackson McDonald
Fourth Defendant : Yeldham Price O'Brien Lusk
Fifth Defendant : Yeldham Price O'Brien Lusk
Sixth Defendant : Deutsch Miller
Seventh Defendant : Gadens Lawyers
Third Party : Allens
Case(s) referred to in judgment(s):
Rinehart v Rinehart [No 3] [2016] FCA 539
Wright Prospecting Pty Ltd v Hancock Prospecting Pty Ltd [No 7] [2016] WASC 305
LE MIERE J:
Summary
On 23 September 2016 I determined that Bianca Rinehart, John Hancock, Hope Welker and Ginia Rinehart (the Children) be joined as defendants: Wright Prospecting Pty Ltd v Hancock Prospecting Pty Ltd [No 7] [2016] WASC 305. The plaintiff in the consolidated proceedings Wright Prospecting Pty Ltd (WPPL) has applied by an application dated 28 October 2016 that pursuant to s 5(1) of the Jurisdiction of Courts (Cross‑Vesting) Act 1987 (Cth) these proceedings be transferred to the Federal Court of Australia (the cross-vesting application). By chamber summons of 1 November 2016 the first and second defendants in the consolidated proceedings, Hancock Prospecting Pty Ltd and Hope Downs Iron Ore Pty Ltd (HPPL and HDIO), have applied for orders in both the consolidated proceedings and the Rhodes proceedings that the parties, or alternatively the defendants, be referred to arbitration pursuant to s 8(1) of the Commercial Arbitration Act 2012 (WA) or alternatively pursuant to s 17J of the WA Commercial Arbitration Act the third and fourth defendants (Bianca Rinehart and John Hancock) be restrained from making any claim in the proceedings in respect of the Hope Downs and East Angeles areas until further order of the court (the stay application). HPPL and HDIO further seek orders that the proceedings be stayed pending the outcome of any arbitration the subject of any order for referral to arbitration or until further order of the court.
At a directions hearing on 4 November 2016 WPPL submitted that the court should make directions for the filing of evidence and submissions in the cross‑vesting application and for the cross‑vesting application to be heard in late November or December. HPPL and HDIO submitted that directions should be made that the cross‑vesting application and the stay application should be listed for further directions on a date to be fixed after the delivery of the decision of the Full Federal Court on appeal from the decision of Gleeson J in Rinehart v Rinehart [No 3] [2016] FCA 539 (the Federal Court Appeals). Alternatively, HPPL and HDIO submitted that the cross‑vesting application and the stay application should be heard at the same time.
WPPL submissions
Senior counsel for WPPL, Mr Myers QC, submitted, in effect, that the cross‑vesting application is a relatively straightforward matter that will not involve any extended hearing and should be dealt with quickly. Mr Myers submitted that the cross‑vesting application should be heard before the stay application.
HPPL and HDIO submissions
Senior counsel for HPPL and HDIO, Mr Giles SC, submitted primarily that the court should defer hearing both applications until after the determination of the Federal Court Appeals and the court should order that Bianca Rinehart and John Hancock file defences and cross‑claims in the meantime. Mr Giles submitted, alternatively, that the two applications should be heard at the same time.
HPPL and HDIO contend that Bianca Rinehart and John Hancock cannot defend WPPL's claim by asserting title to the Hope Downs and East Angelas tenements because there is a negative covenant to that effect in the Hope Downs deed and it would be a breach of contract for them to assert such a claim. HPPL and HDIO say that to the extent that Ms Rinehart and Mr Hancock seek to oppose the claims of WPPL and the Rhodes parties by asserting title to the Hope Downs and East Angelas tenements in breach of the negative covenant, that is a matter which is the subject of an arbitration agreement and by reason of s 8 of the WA Commercial Arbitration Act must be referred to arbitration. In the Federal Court Appeals HPPL and HDIO challenge the order of Gleeson J for the hearing of what has been called the proviso issue, that is whether the arbitration agreement is null and void, and Ms Rinehart and Mr Hancock seek, by cross‑claim, to challenge the referral to arbitration at all. Mr Giles says that until those two contentions are resolved, that is whether the negative covenant prevents Ms Rinehart and Mr Hancock asserting title to the Hope Downs/East Angelas tenements and whether HPPL and HDIO are entitled to refer the dispute to arbitration, the question of cross‑vesting is premature. It does not arise because if HPPL and HDIO are successful in the Federal Court Appeals then there will be either no relevant claim or no relevant proceeding in the Federal Court to which to cross‑vest these proceedings. Mr Giles said that if HPPL and HDIO are unsuccessful in the Federal Court Appeals then their arguments on cross‑vesting fall away.
Mr Giles submits that WPPL's cross‑vesting application is either logically tied to or logically comes after the determination of the stay application. Secondly, Mr Giles says that it would be an efficient use of the resources of the parties and the court to not hear the cross‑vesting application or the stay application until the determination of the Federal Court Appeals.
Position of other parties
The Rhodes parties generally supported the position of WPPL. They say that a reasonable length of time should be permitted for the parties to prepare for the hearing of the cross‑vesting application which should be before the end of the year.
Bianca Rinehart and John Hancock support the orders and directions advanced by WPPL. Ginia Rinehart did not oppose the directions advanced by WPPL. Hope Welker made no submissions.
Federal Court proceeding
A directions hearing in respect of the Federal Court Appeals is scheduled to come before Perram J on 23 November 2016. There is also to be a directions hearing before Gleeson J on 8 December 2016. Counsel for the Rhodes parties, Mr Taylor, said that the Federal Court will be informed of this proceeding, that the Children have been joined as defendants to this proceeding and of the applications that have been made in this court. I do not, of course, know what, if any, directions Justice Perram or Justice Gleeson might make which might be relevant to the applications I am considering. Indeed, I do not know what directions the parties will move for before Justice Perram or Justice Gleeson.
The stay application should not be heard before the Federal Court Appeals
The stay application will cover the same or similar factual and legal issues as those argued before Gleeson J in the stay application by HPPL, HDIO and others in Rinehart v Rinehart [No 3], although additional and different matters will arise because of the claims made by the WPPL and the Rhodes parties in the proceedings before this court. As a single judge I would be bound to follow the decision of the Full Federal Court on the interpretation of the WA Commercial Arbitration Act and the Commercial Arbitration Act 2010 (NSW) and non‑statutory law unless convinced that its decision was plainly wrong. Inconsistent decisions may result if I were to determine HPPL and HDIO's stay application before the Full Federal Court determines the Federal Court Appeals. Furthermore, it is not in accordance with the objects and principles of case flow management set out in O 1 r 4B of the Rules of the Supreme Court 1971 (WA) to hear the stay application before the Full Federal Court determines the Appeals. The hearing of the stay application before Gleeson J took eight days. Mr Giles suggested that the hearing of the stay application in these proceedings might not take so long. Counsel for Bianca Rinehart and John Hancock, Mr Price, said that the application would be resisted and would involve a prolonged hearing. It is not an efficient use of the resources of this court to conduct an extensive interlocutory hearing, possibly in the order of eight days, when the Appeals to be heard by the Full Federal Court in February 2017 will consider similar issues. The stay application should not be heard before the Federal Court Appeals.
The cross‑vesting application should not be postponed
The arguments advanced by Mr Giles are not a sufficient reason for staying the cross‑vesting application until the Federal Court Appeals have been determined.
On the face of it, the same issues that arise, or are likely to arise, in this court arise, or are likely to arise, in the Federal Court proceeding and it is in the interests of justice that the matters be resolved in one court only. The applicants in the Federal Court proceeding, Bianca Rinehart and John Hancock, claim a proprietary interest in the Hope Downs tenements or mining interests which are inconsistent with those claimed by the plaintiffs and the defendants in the consolidated proceedings and the Rhodes proceeding in this court.
The argument of HPPL and HDIO is in effect that although there are presently claims in the Federal Court proceeding and in the proceedings in this court which are inconsistent, the outcome of the Federal Court Appeals or the proviso hearing if it goes ahead or arbitration proceedings if they go ahead might result in Bianca Rinehart and John Hancock being prevented from pursuing their claims to the tenements or mining interests such that there will no longer be inconsistent claims in the two courts. That is not a sufficient reason to not hear WPPL's application until the Federal Court Appeals have been resolved. Mr Giles conceded that there are a range of possible outcomes of the Federal Court Appeals. At this time I do not know what will be the ambit of those appeals or whether WPPL or the Rhodes parties might seek leave to appear on the appeals and if they do whether such leave might be granted. I do not know what will transpire before Gleeson J in the Federal Court directions hearing on 8 December 2016 and what, if any, consequence that might have for the resolution of the claims the subject of the proceedings in this court. I am required by O 1 r 4A and O 1 r 4B RSC to conduct the interlocutory processes of the court with the goal of the elimination of delay beyond that reasonably required for interlocutory activities essential to the fair determination of the issues in contention between the parties and the preparation of the case for trial and with the object of disposing efficiently of the business of the court and facilitating the timely disposal of business. It is inconsistent with those objects to postpone the hearing of an application, which on its face is legitimate and arguable, to await the outcome of proceedings in the Federal Court which are uncertain and will not, in any event, be determined for at least some months.
Furthermore, some of the claim made by the applicants in the Federal Court proceeding which are inconsistent with the claims made by the plaintiffs in the consolidated proceedings and the Rhodes proceeding are arguably not covered by the arbitration agreements and hence will be determined in the Federal Court proceeding in any event. The cross‑vesting application should proceed.
Timetable
The cross‑vesting application is a serious and substantial matter. The parties opposing the application should be given a reasonable opportunity to put on any affidavit material in opposition to the application. I will make the following directions in relation to the cross‑vesting application:
1.Any affidavit material in opposition to WPPL's cross‑vesting application be filed by 23 November 2016.
2.WPPL file its submissions by 29 November 2016.
3.Any submissions in opposition to WPPL's cross‑vesting application be filed by 5 December 2016.
After 5 December, the court is available to hear the application on 14, 15, 19, 20 or 21 December. Counsel for the parties are not all available on any of those dates. I will hear the parties whether the matter should be listed on one of those dates or listed in January 2017.
The following directions will be made in relation to HPPL and HDIO's stay application:
HPPL and HDIO application by chamber summons filed 1 November 2016 be relisted for further directions on a date to be fixed after the delivery of the decision of the Full Federal Court in NSD 916/2016 and NSD 922/2016 or further order.
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