FEDERAL COURT OF AUSTRALIA

Eden Construction Pty Limited v State of New South Wales [2004] FCA 941

PRACTICE AND PROCEDURE – by consent separate questions for determination

Eden Constructions v State of New South Wales [2004] NSWSC 410

EDEN CONSTRUCTION PTY LIMITED v STATE OF NEW SOUTH WALES

N 833 OF 2004

CONTI J

19 JULY 2004

SYDNEY

THE COURT DIRECTS THAT:

1.         The parties prepare signed short minutes of order reflecting these reasons and forward the same to chambers.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR DIRECTIONS

Background

1                     On 25 July 2003, the applicant (‘Eden’) filed a summons in the Supreme Court of New South Wales Technology and Construction List containing the following claims, literally reproduced:

‘1.        An order for damages;

2.         An order for damages pursuant to Section 82 of the Trade Practices Act 1974;

1.         A declaration that the Defendant is in Breach of Section 46 of the Trade Practices Act 1974;

2.         A declaration that the Defendant is in Breach of Section 45(2) of the Trade Practices Act 1974;

3.         A declaration that the Plaintiff is to be removed from the Defendant’s performance review list;

3.         An order for interest pursuant to section 94 Supreme Court Act 1970 from March 2002 at the rate of 9% pa and thereafter continuing to the present date;

4.         An order for costs.’

2                     Subsequently on 26 August 2003, Eden filed in the same List of the Supreme Court of New South Wales an amended summons containing the same claims.

3                     Subsequently again on 10 December 2003, Eden filed a further amended summons (‘FAS’) in the same List, but omitting a claim for a declaration as to breach of s 45(2) of the Trade Practices Act 1974 (Cth) (‘the TP Act’).

4                     Also on 10 December 2003, Eden filed a notice of motion for an order under s 6(3) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (presumably intending thereby to refer to the New South Wales legislation).

5                     On 7 May 2004, on the application of the respondent (‘the State’), though against the opposition of Eden, the Supreme Court of New South Wales (McDougall J) ordered that the proceedings be cross-vested to the Federal Court of Australia.

6                     The points of claim forming part of the FAS plead that all material times, the State was:

‘carrying on the business of letting commercial tenders for ‘civil works’, entering into commercial dealings in relation to those tenders and administering and supervising Government procurement and “civil works” for and on behalf of the State of New South Wales and Local Government (pursuant to the Local Government Act) in New South Wales.’

7                     His Honour provided reasons for judgment for making the cross-vesting order sought by the State (Eden Constructions v State of New South Wales [2004] NSWSC 410).  Those reasons did not specifically address the question whether the conduct complained of on the part of the State occurred in the course of, or for the purpose of, carrying on a business for the purposes of the TP Act. 

8                     Until 20 July 1996, the TP Act did not apply to the Crown in the right of any of the States, nor did it apply to any instrumentality or agent of the State.  Section 2B of the TP Act has thenceforth provided as follows:

‘2B(1)  The following provisions of this Act bind the Crown in right of each of the States…, so far as the Crown carries on a business, either directly or by an authority of the State…

            (a)        Part IV

            …

            (c)        the other provisions of this Act so far as they relate to the above provisions.’

9                     The Points of Claim refer explicitly to some conduct occurring prior to 20 July 1996: see par 9.  Other provisions of the Points of Claim refer to conduct without designating times involved.  It has not been practical for me to examine, for the purposes of the present context, the large bulk of affidavit material tendered by the parties to date.

10                  In any event, since no defences have been filed, it is not possible for me to ascertain from the material sent to the Federal Court by the Supreme Court, whether the State concedes that all of the conduct complained of by Eden occurred in the course of the State carrying on a business. 

11                  Eden is undoubtedly conscious of the need to establish the carrying on of a business for the purposes of its ss 46 and 52 causes of action, and has pleaded that the State has at all material times been ‘carrying on the business of letting commercial tenders for “civil works”, entering into commercial dealings in relation to those tenders, and administering and supervising Government procurement and “civil works” for and on behalf of the State of New South Wales and Local Government (pursuant to the Local Government Act) in New South Wales’.  Whether it can rightly be said that the State, whether in carrying on a business or otherwise, has misused or taken advantage of market power in contravention of s 46, is a matter which Eden may well wish to consider, before further substantial financial commitments are made on its part for the conduct of this complex litigation. 

12                  I express no view one way or another at this stage as to the viability of the causes of action against the State as presently framed.  I have mentioned the foregoing matters, in case they should be addressed before significant expenditure is incurred in pursuant of the proceedings in this Court on the basis presently pleaded.

Separate questions for determination

13                  The parties have mutually agreed that the following separate questions be determined pursuant to Order 29 Rule 2 of the Federal Court Rules, in relation to two of the projects  by way of example:

‘1.        In respect of the Dubbo Overflow Ponds project referred to in the Schedule to the Further Amended Summons, was the conduct of the Respondent alleged in the Schedule in respect of that project conduct in the carrying on of a business, within the meaning of section 2B of the Trade Practices Act 1974 (Cth)?

2.         In respect of the Moruya Heads Sewerage Transportation Systemproject referred to in the Schedule of the Further Amended Summons, was the conduct of the Respondent alleged in the Schedule in respect of that project conduct in the carrying on of a business, within the meaning of section 2B of the Trade Practices Act 1974 (Cth)?’

I will therefore direct the parties to prepare short minutes of order which progress the matter for the hearing and determination of those separate questions, and will leave to the parties to consider whether any of the matters to which I have earlier referred bear upon those questions, and if so, to what extent. 

Associate:

Dated:              19 July 2004