FEDERAL COURT OF AUSTRALIA

Pedra Holdings Pty Ltd v Westfield Shoppingtown Carousel Pty Ltd [2005]
FCA 909

PROCEDURE – notice of motion for transfer of proceedings to Federal Magistrates Court – application made immediately following order by Federal Magistrates Court to transfer to Federal Court – whether application for re-transfer competent – no application of res judicata because no final judgment – motion incompetent as an abuse of process

Federal Court of Australia Act 1976 (Cth) s 32AB

Federal Magistrates Act 1999 (Cth) s 39(3)

Trade Practices Act 1974 (Cth) s 86AA

Federal Court Rules O 82 r 3, O 82 r 5

Federal Magistrates Court Rules r 8.02

DA Christie Pty Ltd v Baker [1996] 2 VR 582 cited

Hepburn v McLaughlins Nominee Mortgage Pty Ltd (unreported, BC 9700797, 18 March 1997) cited

Nominal Defendant v Manning (2000) 50 NSWLR 139 distinguished

Pedra Holdings & Ors v Westfield & Ors [2005] FMCA 475 referred to

Rogers v The Queen (1994) 181 CLR 251 cited

Sea Culture International Pty Ltd v Scoles (1991) 32 FCR 275 followed

Turner v Bulletin Newspaper Co Pty Ltd (1974) 131 CLR 69 referred to

PEDRA HOLDINGS PTY LTD, MYRAN HOLDINGS PTY LTD, HENRY AVELING and MARIANNE AVELING v WESTFIELD SHOPPINGTOWN CAROUSEL PTY LTD, PT LIMITED PTY LTD, CPM (WA) PTY LTD and CPT MANAGER LIMITED

WAD 104 of 2005

NICHOLSON J

19 JULY 2005

PERTH

THE COURT ORDERS THAT:

1.                  The applicants’ notice of motion dated 10 June 2005 be dismissed.

2.                  The applicants pay the respondents’ costs on the motion.

3.                  The proceeding be set down for further directions.

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

REASONS FOR JUDGMENT

1                     The applicants apply for an order that the proceeding be transferred to the Federal Magistrates Court (‘the FMC’).  In so doing they rely on s 32AB of the Federal Court of Australia Act 1976 (Cth) (‘the FCA’) and O 82 r 5 of the Federal Court Rules (‘FCR’). 

2                     The competency of the application is objected to by the respondents.  Competency becomes an issue in the view of the respondents because on 15 April 2005 Raphael FM, in the FMC, ordered that the proceedings be transferred to this Court pursuant to s 39(3) of the Federal Magistrates Act 1999 (Cth) (‘the FM Act’) and r 8.02 of the Federal Magistrates Court Rules (‘the FM Rules’). 

factual background

3                     The background to the application may be set out more fully as appears as follows from the submissions on behalf of the third and fourth respondents:

4                     This proceeding concerns the applicants’ claim for relief which was originally made by an application and statement of claim filed in the FMC on 17 September 2004.  The claim was subsequently amended by an amended application and amended statement of claim filed on 22 October 2004 and by an updated further amended statement of claim.

5                     By a re-amended notice of motion filed in those FMC proceedings on 23 December 2004, the third and fourth respondents sought orders that, amongst other matters, ‘the action be transferred to the Western Australian District Registry of the Federal Court of Australia for want of jurisdiction and/or pursuant to Rule 8.02(1) of the Federal Magistrates Court Rules’.

6                     Following the hearing of that notice of motion, Raphael FM made an order on 15 April 2005 (‘the transfer order’) (Pedra Holdings & Ors v Westfield & Ors [2005] FMCA 475) that the applicants’ claims be remitted to the Federal Court for further hearing pursuant to s 39(3) of the FM Act and r 8.02 of the FM Rules.  Raphael FM’s reasons for making the transfer order may be summarised as follows:

(a)                Section 86AA of the Trade Practices Act 1974 (Cth) (‘the TPA’) restricts the FMC’s jurisdiction to make an award of loss or damage in ‘proceedings under section 82’ (of the TPA) to $200 000.

(b)               Depending on:

(i)                  the quantum of the applicants’ un-particularised claims for loss and damage;

(ii)                whether the jurisdictional limit of $200 000 applies to loss and damage claimed pursuant to the TPA in the same proceedings, or only to claims made pursuant to s 82 of the TPA;

(iii)               whether and which of the applicants’ claims are made pursuant to s 87 of the TPA, rather than s 82; and

(iv)              whether the jurisdictional limit applies to all of the applicants collectively, or to each of the applicants separately;

then the applicants might effectively abandon part of their claim, or even most of their claim, if they are successful in ensuring that the proceedings remain in the FMC (see pars 14-16 of Raphael FM’s reasons for judgment).

(c)                As stated in par 17 and par 18 of his reasons for judgment:

‘17.   In these days of judicial control of litigation it is not enough for a court to sit back and watch a litigant being deprived of very large sums of money which he might be entitled to by way of damages because of an ill founded view about the jurisdiction of the court.  It seems to me that it is also inappropriate for the court to allow litigants to expend money in legal fees to argue a point of this type when by commencing the proceedings in the Federal Court or having them transferred there, there will be no possibility that the damages will be cut down by virtue of some jurisdictional limit.  It is unfair that the respondents should be required to pay their lawyers any money to argue the point when there would have been no necessity for such argument had the case been commenced in or transferred to the Federal Court.  It seems to me that the way in which the applicants have put their case for a refund under s.87(2) strains the conception of a refund.  It seems to me that if the respondents are liable for the alleged misrepresentations then what the applicants lost because of the reduction in their business through the additional competition entitles them to restitutio in integrum and that is a damages concept.  It is not a refund.

18.    When considering a motion to transfer I am obliged pursuant to s.39(3) of the Federal Magistrates Act 1999 to have regard to the matters contained in Rule 8.02 and also to other matters including the interests of the administration of justice.  It is in the interests of the administration of justice that parties should be free to claim their full damages and not be constrained as to the manner of expressing them by jurisdictional limits of a lower court.  There is, regrettably, no provision in the Act for consent to increase jurisdiction.  In those circumstances I believe I should act on the motion of the Third and Fourth Respondents, supported by the First and Second Respondents to transfer this matter to the Federal Court.’

7                     The applicants commenced proceedings in this Court appealing against the transfer order (proceedings WAD 100 of 2005).  Those appeal proceedings were discontinued on 27 May 2005. Section 39(6) of the FM Act provides that ‘no appeal shall lie from a decision of the FMC in relation to the transfer of a proceeding under subsection (1)’. 

8                     The first action taken by the applicants since these proceedings were transferred to the Federal Court has been to apply to transfer the proceedings back to the FMC (‘the current application’) in accordance with s 32AB of the FCA. 

9                     There has been no change in the circumstances referred to in Raphael FM’s reasons for judgment since the transfer order was made.

10                  The applicants now ask that this Court overturn the decision of Raphael FM’s decision on the transfer order even though an appeal from it is precluded by statute. 

applicants’ submissions

11                  The applicants submit the application is competent. 

12                  They seek to support this by contending, first, that as the Federal Court is the appellate jurisdiction from the FMC, a decision of a Federal Magistrate cannot preclude a Federal Court Judge from considering an application in a Federal Court proceeding.  This submission lacks logic and any foundation in law.  It is also submitted that the application is analogous to an application to transfer a proceeding from one registry of the Federal Court to another registry of the Federal Court.  This likewise lacks any foundation in law. 

13                  It is further advanced that as the order made by Raphael FM was an interlocutory order, it is able to be reviewed at any time before the final disposal of the action:  Turner v Bulletin Newspaper Co Pty Ltd (1974) 131 CLR 69 at 96-97.  However, the application is one which is the subject of an express statutory provision precluding an appeal:  s 39(6) of the FM Act.

respondents’ submissions

res judicata or cause of action estoppel

14                  The first and second respondents submit that the doctrine of res judicata or cause of action estoppel is applicable to preclude the competency of the application now brought by the applicants.  The third and fourth respondents are in agreement with that submission only if the Court is satisfied that the transfer order made by Raphael FM is a final judgment for the purposes of the doctrine.  The applicants accept that Siopis J has already held that the transfer order made in the FMC was interlocutory in character.  There is no reason to seek to depart from that ruling.  There is, therefore, no final judgment for the purposes of the application of this doctrine.  It is not the case that the order of Raphael FM is interlocutory in the sense of being until further order. 

application contrary to legislative intent

15                  The third and fourth respondents submit that regard must be had to the intention of the legislature in enacting s 39(6) of the FM Act when determining whether the current applications is competent.  The Explanatory Memorandum for the Federal Magistrates Bill 1999 (Cth) which introduced that provision states:

‘Under sub-clause 39(6) no appeal lies from such a decision.  This is consistent with the provisions in the cross-vesting legislation, where no appeal lies from a transfer decision, and is designed to prevent time-wasting appeals on minor procedural matters which do not affect the substantive rights of the parties.  Subclause 39(8) provides that this section does not apply to proceedings of a kind specified in the regulations.’

16                  The transfer order does not affect the substantive rights of the parties.

17                  The current application is clearly contrary to the legislative intent as it is an attempt to reverse a non-appealable decision to transfer proceedings to a new court by other means (i.e. by means other than an appeal). 

18                  In support, the third and fourth respondents rely on Hepburn v McLaughlins Nominee Mortgage Pty Ltd (unreported, BC 9700797, 18 March 1997) at 26 per Fryberg J where he said:

‘The appellant also pressed the appeal against the dismissal of its application for the transfer of the proceedings to the Supreme Court of New South Wales under s 5 of the Jurisdiction of Courts Vesting (Cross-Vesting) Act 1987.  S13 of that Act provides that an appeal does not lie from a decision of a court in relation to the transfer of a proceeding under that Act.  To avoid the effect of that section, the appellant argued that the Court has an inherent supervisory jurisdiction to set aside an order which was void; and that the order dismissing the summons was void because no reasons were given and the rules of natural justice were breached.  No authority was cited, which was not surprising.  The argument is without authority, is contrary to principle, denies the plain effect of an act of Parliament and is hopeless.’

19                  The legislative scheme is clearly intended to operate on the basis that a party which has lost its opposition to a transfer of proceedings to the Federal Court in the FMC and had an order for costs made against it, cannot appeal that decision.  It would be a negation of that legislative intent if that party could nevertheless immediately initiate application for re-transfer in the Federal Court with the inherent risk of again having a costs order made against it. 

20                  Even more so is this the case where, as here, the applicants accept that the order of Raphael FM was an interlocutory order made in the course of a proceeding which is now to be treated as if it had been commenced in the Federal Court:  FCR O 82 r 3.  That makes it apparent that not only does the motion seek to circumvent the statutory preclusion of the right of appeal but it also demonstrates an attempt to re-litigate an issue already determined in a proceeding commenced in this Court.  In Sea Culture International Pty Ltd v Scoles (1991) 32 FCR 275 at 279 French J said:

‘An attempt to litigate in the court a dispute or issue which has been resolved in earlier litigation in this or another court or tribunal may also, according to the circumstances, constitute an abuse of process even if not attracting the doctrines of res judicata or issue estoppel.’

abuse of process

21                  The third and fourth respondents take the issue of abuse of process further with the following submissions.

22                  The Federal Court of Australia is a superior court of record (see s 5(2) of the FCA) and, as such, it has an inherent power to prevent an abuse of process.  The third and fourth respondents quote Mason CJ:  ‘The circumstances in which abuse of process may arise are extremely varied, and it would be unwise to limit those circumstances to fixed categories’.  (Rogers v The Queen (1994) 181 CLR 251 at 255). 

23                  Those respondents say the applicants’ application to re-transfer the proceedings effectively asks this Court to reconsider a decision:

(a)                which this Court is expressly prohibited from re-considering as an appeal; and

(b)               which would, but for that prohibition, properly be a matter for such an appeal;

under the guise of a fresh application to transfer.  The result is the applicants’ application is to be understood as a collateral attack on the non-appealable decision of Raphael FM.  That would be so because any argument on the merits of the applicants’ application would effectively be a re-argument of that part of the third and fourth respondents’ re-amended notice of motion (see par 2 and par 5 above) which led to these proceedings being transferred to this Court. 

24                  The third and fourth respondents also contend that to re-argue that application would be unreasonable and oppressive.  If this Court decided to hear the current application as a ‘fresh’ application and then denied the application, that would be a futile waste of this Court’s limited resources and oppressive, as it would also be a waste of the parties’ legal costs.  Further if this Court decided to hear the current application as a ‘fresh’ application and then granted that application (i.e. notwithstanding the respondents’ submissions that the application has no merit), on the same basis, the respondents could make their own ‘fresh’ application in the FMC to re-re-transfer the proceedings back to the Federal Court.  This would create a procedural ‘loop’ of jurisdictional transfers which would be wasteful, futile, oppressive to all of the parties and absurd.

25                  The first and second respondents also rely on the contention of abuse of process.  In doing so, they point to the similarity of the provisions in the FCA and those in the FM Act in relation to the transfer of proceedings.  They say it is particularly important to consider that s 32AB(6)(c) of the FCA and s 39(4)(c) of the FM Act require the Federal Court and the FMC respectively to consider the resources available to the FMC.  These respondents therefore submit the motion is an attempt to circumvent the ordinary processes of judicial system and so amounts to an abuse of process:  DA Christie Pty Ltd v Baker [1996] 2 VR 582.  Additionally, the first and second respondents contend that it is important to take into account the apparent policy behind the provisions preventing appeals against decisions in relation to transfer of proceedings between courts, namely, the prevention of repeated consideration and re-consideration of the question of which court should be seized with the conduct of the proceedings. 

26                  The applicants contend it is not the law that an applicant making a secondary interlocutory application is guilty of an abuse of process unless the other party is guilty of fraud or the application rests on evidence which could not reasonably have been relied on before.  In support Nominal Defendant v Manning (2000) 50 NSWLR 139 is cited.  There the majority (Heydon JA and Foster A-JA) supported that proposition, being contrary to the majority reasoning in the context of Victorian legislation in DA Christie.  Accepting the majority view in Manning, it cannot be concluded that it assists the applicants here.  That is because the immediacy of the application, the presence of the statutory preclusion of appeal from the order of the FMC, the similarity in the provisions sought to be invoked for
re-transfer to those already invoked for transfer and the deemed continuity of the proceeding in this Court are among the circumstances of the particular case pointing towards the abusive character of the applicants’ motion here:  cf Heydon JA at 147-148 at [45] in Manning.  The latter is not an authority that, absent the rule rejected in Manning, a second interlocutory application cannot in the particular circumstances be found to be abusive of process in its character.  As French J also said in Sea Culture at 279:

‘Underlying the power that courts have assumed to stay or dismiss proceedings for abuse of process is a policy of preventing waste of judicial resources and their use for purposes unrelated to the determination of genuine disputes.’

27                  I agree with these remaining submissions of the respondents.  I consider the applicants’ motion is clearly an abuse of process. 

CONCLUSION

28                  The notice of motion for re-transfer is an abuse of process and, being incompetent, must be dismissed. 

Associate:

Dated:              19 July 2005