FEDERAL COURT OF AUSTRALIA

Mineral Commodities Ltd v Promet Engineers Africa (Pty) Ltd (No 2) [2008] FCA 525

PRACTICE AND PROCEDURE – service out of the jurisdiction – directors resident in South Africa wrote letters and sent emails containing representations– whether prima facie case that directors primarily liable under extended application of Trade Practices Act 1974 (Cth)

Trade Practices Act 1974 (Cth) s 75B

Federal Court Rules O 8 r 3

Mineral Commodities Ltd v Promet Engineers Africa (Pty) Ltd [2008] FCA 30

MINERAL COMMODITIES LTD (ACN 008 478 653) v PROMET ENGINEERS AFRICA (PTY) LTD, PROMET ENGINEERS PTY LTD (ACN 115 687 057), RICHARD GEORGE JAMES FORD, ROBERT JOHN BENNETT and JAMES DINSDALE CRIBBES

WAD 201 of 2007

SIOPIS J

10 APRIL 2008

PERTH

THE COURT ORDERS THAT:

1.                   The applicant has leave to amend its Notice of Motion.

2.                   Kariba Kono (SL) Limited be added as the second applicant to these proceedings.

3.                   Leave be granted to file an amended Application and Statement of Claim in the form annexed to this Second Amended Notice of Motion and marked “A”.

4.                   The applicant has leave under Order 8 rule 3(2) of the Federal Court Rules to serve the Amended Application and Statement of Claim upon the first respondent and the third respondent and the fourth respondent out of the jurisdiction and in the Republic of South Africa.

5.                   Service may be effected on the first and third and fourth respondents by private agent.

6.                   The costs of this application be in the cause.

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

REASONS FOR JUDGMENT

1                     This is an amended notice of motion for leave to amend the application and the statement of claim and also seeking leave to serve the amended originating process out of Australia, pursuant to O 8 r 3(2) of the Federal Court Rules.

2                     There are amendments which are proposed to be made to the application and the statement of claim.

3                     As to the application, it is proposed to join a new applicant.  It is Kariba Kono (SL) Limited (Kariba), a company which is incorporated in Sierra Leone, and is the company which actually carries out the tailings operations in Sierra Leone to which I referred in my earlier reasons in this case (Mineral Commodities Ltd v Promet Engineers Africa (Pty) Ltd [2008] FCA 30).

4                     The amendments to the statement of claim introduce claims against the fifth respondent for misleading or deceptive conduct in contravention of the Fair Trading Act 1987 (WA) (the FTA).

5                     There are also amendments proposed in respect of the claims brought against Mr Ford and Mr Bennett, the third and fourth respondents.  The amendments have been made as a consequence of comments that I made in my earlier reasons in respect of the apparent lack of evidence which would support a prima facie case against Mr Ford and Mr Bennett under s 75B of the Trade Practices Act 1974 (Cth) (the TPA), by reason of their involvement in the breaches of the first respondent.

6                     The proposed amendments have deleted the claims against Mr Ford and Mr Bennett which were based on s 75B of the TPA.  Instead, the applicant now seeks to rely upon the extended application of the TPA under s 6, to plead a direct and primary liability in respect of each of Mr Ford and Mr Bennett.  This primary liability is founded on the evidence of letters which were written by Mr Ford and Mr Bennett from South Africa to the applicant and emails which were transmitted by Mr Ford to the applicant.

7                     The only issue that really arises which is new in respect of Mr Ford and Mr Bennett is whether there is a prima facie case of primary liability on the part of Mr Ford and Mr Bennett on the basis of the allegations made in the proposed pleading.

8                     It is perhaps curious that there should be a claim which alleges a primary liability under the TPA on the part of the individuals as well as on the part of the company of which they are directors.  There is an analogy, however, with the claims which are quite frequently brought where an applicant alleges primary liability on the part of both the director and the company founded upon contraventions of both the FTA and the TPA, in respect of the same misrepresentation.  The claim against the individual is based on a contravention of the FTA, whereas the claim against the company for a contravention of the TPA and/or the FTA is based on the attribution of the individual’s acts to the company.  The amended claim against Mr Cribbes, is an example of such a claim.  On the basis of the analogy, I am satisfied that there is a prima facie case, in the sense which is necessary for service out of the jurisdiction, in respect of the amended claim which is proposed to be made against Mr Ford and Mr Bennett.

9                     I am also satisfied that there is a prima facie case made by the Sierra Leone company, Kariba.  As is pointed out in the submissions, there is no allegation in the amended statement of claim that Kariba relied upon the representations which are relied upon, as comprising the impugned conduct.  However, it is not necessary for the party which suffers loss to have actually relied upon the impugned conduct.  Accordingly, I am satisfied that there is a prima facie case, in the sense necessary for service out of the jurisdiction in relation to the claim made by Kariba.

10                  All the other matters which need to be satisfied in respect of service out of the jurisdiction have already been dealt with in my earlier decision.

11                  I am, therefore, content to make the orders which are set out in paras 1 to 6 of the amended notice of motion.

Associate:

Dated:  18 April 2008