FEDERAL COURT OF AUSTRALIA

Auskay International Manufacturing & Trade Pty Ltd v Qantas Airways Limited (No 6) [2009] FCA 1465

PRACTICE AND PROCEDURE – motion to transfer proceeding to another registry of the Court – whether it be in the interests of justice that the case be transferred to another registry – motion refused

Federal Court of Australia Act 1976 (Cth) s 48

Federal Court Rules O 10 r 1(2)(f)

Judiciary Act 1903 (Cth) s 79

Law Reform (Miscellaneous Provisions) Act 1946 (NSW) s 5

Trade Practices Act 1974 (Cth) ss 45, 52, 82

Wrongs Act 1958 (Vic) ss 23A, 23B

 Auskay International Manufacturing & Trade Pty Ltd v Qantas Airways Limited (2008) 251 ALR 166, referred to

Bialkower v Acohs Pty Ltd (1998) 83 FCR 1, cited

Burke v LFOT Pty Limited (2002) 209 CLR 282, cited

Henderson v Amadio Pty Ltd (No 1) (1995) 62 FCR 1, cited

Markethaven Pty Ltd (subject to Deed of Company Arrangement) v Commonwealth of Australia [2009] FCA 694, referred to

Mortimer v Opes Prime Stockbroking Ltd (ACN 086 294 028) (Administrator Appointed)(in liquidation) [2009] FCA 227, referred to

National Mutual Holdings Pty Ltd v The Sentry Corporation (1988) 19 FCR 155, cited     

Wyllie Group Pty Ltd v ANZ Securities Ltd [2000] FCA 1382, referred to

AUSKAY INTERNATIONAL MANUFACTURING & TRADE PTY LTD (ACN 078 654 243) v QANTAS AIRWAYS LIMITED (ACN 009 661 901), DEUTSCHE LUFTHANSA AKTIENGESELLSCHAFT (ARBN 495232), SINGAPORE AIRLINES LTD (ARBN 1056195), SINGAPORE AIRLINES CARGO PTE LTD (ARBN 95934857), CATHAY PACIFIC AIRWAYS LIMITED (ARBN 479514), AIR NEW ZEALAND LTD (ARBN 312685), AIR NEW ZEALAND (AUSTRALIA) PTY LTD (ACN 084 974 569), JAPAN AIRLINES INTERNATIONAL CO LIMITED (ARBN 564358) and BRITISH AIRWAYS PLC (ARBN 2747597)

VID 12 of 2007

TRACEY J

11 DECEMBER 2009

MELBOURNE

THE COURT ORDERS THAT:

1.                  The applicant’s motion, notice of which was given on 18 September 2009, be refused.

2.                  The applicant pay the second, third, fourth, fifth, eighth and ninth respondents’ costs of the motion.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

1                     This proceeding was commenced by application on 11 January 2007.  The application is brought by the applicant as a representative party on behalf of group members who were persons who had paid for air freight services provided by some or all of the respondents.

2                     The applicant’s central allegation is that the respondents were members of a cartel which had agreed to (and did) fix charges for international air freight moving into and out of Australia.  It was alleged that, in about January 2000, the respondents and other air freight carriers had agreed that each of them would fix and maintain charges and conceal their agreement from others, including the applicant and relevant group members.  Prices were increased by the imposition of an agreed fuel surcharge, a security surcharge and a war-risk surcharge.  It was alleged that this conduct contravened s 45 of the Trade Practices Act 1974 (Cth)(“the TPA”) and caused loss and damage to the applicant and group members.

3                     The applicant has made a series of attempts to draft viable applications and statements of claim.  In Auskay International Manufacturing & Trade Pty Ltd v Qantas Airways Limited (2008) 251 ALR 166, I struck out the applicant’s second amended statement of claim but granted leave to replead.  That leave was availed of and further attempts were made to produce an appropriate statement of claim.  Unfortunately, I have, today, found it necessary to strike out the applicant’s fourth amended statement of claim.  Procedurally, there matters rest.

4                     On 9 October 2009, I heard argument on a motion, filed by the applicant, for this proceeding to be transferred to the New South Wales District Registry of the Court.  The application was opposed by the second, third, fourth, fifth, eighth and ninth respondents.

5                     Section 48(1) of the Federal Court of Australia Act 1976 (Cth) (“the Act”) provides that:

“The Court or a Judge may, at any stage of a proceeding in the Court, direct that the proceeding or a part of the proceeding be conducted or continued at a place specified in the order, subject to such conditions (if any) as the Court or Judge imposes”.

6                     Order 10 r 1(2)(f) of the Federal Court Rules empowers the Court to

“… direct that the proceeding be transferred to a place at which there is a Registry other than the then proper place.  Where the proceeding is so transferred, the Registrar at the proper place from which the proceeding is transferred shall transmit all documents in his charge relating to the proceeding to the Registrar at the proper place to which the proceeding is transferred”.

7                     These provisions were considered by a Full Court in National Mutual Holdings Pty Ltd v The Sentry Corporation (1988) 19 FCR 155.  The Court said (at 161-162) that:

“The Federal Court is a Court of wide jurisdiction throughout Australia whose judges may sit, whether as Full Courts or single judges, at any place in Australia.  The Court has registries in each of the capital cities of the States and the Territories.

The purpose of the provision in the rules of a “proper place” is to ensure the orderly and efficient conduct of the Court’s business by requiring all documents filed in a proceeding to be in the custody and charge of the registry where the matter is then proceeding.

The power conferred on the Court or a judge by s 48 is in terms wholly unfettered.  It should be exercised flexibly having regard to the circumstances of the particular case.  It would be regrettable and unwise if the Court were to circumscribe the general power conferred by s 48 with inflexible rules or impose inelastic constraints upon its exercise.  As the power may be exercised subject to conditions, the Court or judge is in a position to mould orders under the section to take account of the many and varied circumstances that arise in particular cases.

The power conferred by s 48 recognises the national character of this Court.  The factors which the Court is entitled to take into account in considering whether one city is more appropriate than another for interlocutory hearings or for the trial itself are numerous.  The Court must weigh those factors in each case.  Residence of parties and of witnesses, expense to parties, the place where the cause of action arose and the convenience of the Court itself are some of the factors that may be relevant in particular circumstances.

The balance of convenience will generally be a relevant consideration, but not necessarily determinative of each case.  A party commences a proceeding by filing an application in a particular registry of the Court.  If that party or another party wishes to have the proceeding conducted or continued in another place he may apply to the Court for an order under s 48 or O 10 r 1(2)(f) or O 30, r 6 as the case may be.  There is no onus of proof in the strict sense to be discharged by the party seeking to conduct or continue the proceedings elsewhere.  It should be noted that the Court may exercise its powers under O 30, r 6 either on the application of a party or on its own motion.  The Court must, however, be satisfied, after considering all relevant matters, that there is sound reason to direct that the proceeding be conducted or continued elsewhere.  Its starting point is that the proceeding has been commenced at a particular place.  Why should it be changed?  On the one hand, if the party who commenced the proceeding chose that place capriciously the Court would be justified in giving no weight to the choice of place.  At the other end of the scale, a proceeding may have continued for some time at the place of commencement with many steps having been taken there, for example, filing of pleadings and affidavits, discovery and inspection.  Due weight would be given by the Court to such matters before directing that the proceeding should continue at a different place.

The balance of convenience is important, but its weight must vary from case to case.  Ultimately the test is: where can the case be conducted or continued most suitably bearing in mind the interests of all the parties, the ends of justice in the determination of the issues between them, and the most efficient administration of the Court.  It cannot and should not, in our opinion, be defined more closely or precisely” (emphasis added).

8                     These principles have been applied in many cases.  Not surprisingly, the applicant places reliance on cases such as Wyllie Group Pty Ltd v ANZ Securities Ltd [2000] FCA 1382, Mortimer v Opes Prime Stockbroking Ltd (ACN 086 294 028) (Administrator Appointed)(in liquidation) [2009] FCA 227and Markethaven Pty Ltd (subject to Deed of Company Arrangement) v Commonwealth of Australia [2009] FCA 694, in which the Court granted applications to transfer proceedings between Registries. These decisions are of limited assistance given the wide range of variables which confronted the judges who decided them.  These factors included the residency of the parties and witnesses, the expense and prejudice likely to be experienced by the respective parties were a transfer to be granted, the similarity of causes of action in a proceeding on foot in the other Registry involving the same parties, and the possibility of interference with a fair trial.

9                     As National Mutual makes clear, the Court has an unfettered discretion which is to be exercised in the interests of justice in the circumstances of the case in which the application is made.

10                  The applicant contends that the proceeding should be transferred to the New South Wales District Registry for a number of related reasons.  Since the representative proceeding was instituted in Victoria, the Australian Competition and Consumer Commission (“the ACCC”) has commenced proceedings against some of the respondents in respect of the same or substantially similar conduct on which it appears that the present applicant also relies.  All of the proceedings commenced by the ACCC have been filed in the New South Wales District Registry. 

11                  Proceedings against Qantas and British Airways were heard and determined in Sydney by Lindgren J in December 2008.  There are presently before Jacobson J proceedings which have been brought by the ACCC against Singapore Airlines (NSD 1980/2008), Cathay Pacific (NSD 363/2009), Emirates Airlines (NSD 876/2009) and Garuda Airlines (NSD 955/2009).  Jacobson J has expressed the view that “… it seems to me that it is convenient for [these cases] to be case managed together.  They are going to raise very similar issues and it would be more effective if they run in tandem, at least for the time being”.  Jacobson J has also been involved in a number of interlocutory hearings in some of these proceedings.

12                  The applicant contends that there are many common issues which will arise in the proceedings commenced by the ACCC and the representative proceedings.  All, so it is said, concern the same conduct which involved the entering into and implementation of the “global cartel arrangement”, the “fuel surcharge arrangement” and the “security surcharge arrangement” which the applicant in the present proceeding says gave rise to compensable loss and damage.  The applicant submits that the only material difference between this and the proceedings instituted by the ACCC relates to the penalties sought.  It further submits that it will, at trial, be likely to rely on the same evidence and arguments which it expects to see deployed in the ACCC proceedings.  If the present proceeding and the others which are pending in Sydney were to be heard consecutively, it was submitted, a “multiplicity of proceedings” and “repetition of evidence” would be avoided.  This process would be assisted were it to be managed by the same judge.  For this reason the applicant seeks an order that, when transferred, the proceeding be placed in Jacobson J’s docket.

13                  In my view the application confronts some insuperable difficulties.  The first is that there is still no viable statement of claim.  Unless and until an acceptable statement of claim is prepared and defences are filed, the issues in the proceeding will not be defined.  At this stage, it is not possible to make any meaningful comparison between the issues which may arise in the present proceeding and those which will arise in the proceedings pending before Jacobson J in Sydney.  What can be said with greater certainty is that damages will not be an issue in the Sydney proceedings, and that not all of the respondents in the present proceeding are being pursued by the ACCC in the proceedings seeking pecuniary penalties.

14                  There was no evidence or information before me as to when the final hearings in the Sydney matters were likely to occur.  It appears that, at present, they are all at a pre-trial management stage.  I cannot assume that, were the present proceeding to be transferred to the New South Wales District Registry, it would be ready for hearing consecutively with one or more of the other proceedings.  They all seem to have advanced procedurally a good deal further than the present proceeding.  It remains to be seen whether the applicant will seek leave to re-plead its statement of claim.  If leave is granted further time will pass while a new statement of claim is prepared and any objections to it by the respondents are considered by the applicant.  There then may or may not be a further strike-out application which will need to be heard and determined.  If a viable statement of claim emerges and defences are filed, it has already been foreshadowed that significant discovery issues will need to be resolved.

15                  Further delay could also be expected while opt out procedures and notifications, required by Part IVA of the Federal Court of Australia Act 1976 (Cth), are dealt with.

16                  For these reasons, it seems to me highly unlikely that, were the present proceeding to be transferred to the New South Wales District Registry, there could be any confidence that it would be ready for hearing immediately after any of the matters presently in Jacobson J’s docket.

17                  At the present time it is impossible to identify the witnesses who may be called at trial, much less where they reside and where it would be most convenient for them to give evidence.  What is known is that most counsel and solicitors currently retained by the parties are resident in Melbourne.

18                  There is also a concern, felt by a number of respondents, that they will be prejudiced if the application is granted.  If the matter is tried in Victoria and the applicant succeeds, a respondent will be able to seek contribution from other respondents:  see Henderson v Amadio Pty Ltd (No 1) (1995) 62 FCR 1 at 200-201 (per Heerey J).  This is because s 79 of the Judiciary Act 1903 (Cth) picks up certain provisions which are found in ss 23A and 23B of the Wrongs Act 1958 (Vic).  By s 23B(1), “a person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage …”.  Section 23A(1) provides that s 23B(1) applies to liability arising in “tort, breach of contract, breach of trust or otherwise”(emphasis added).  Contribution can, therefore, be ordered where there is a successful claim for damages under s 82 of the TPA.

19                  There is, to say the least, some doubt that an order for contribution could be made in respect of damages awarded under s 82 following a trial held in New South Wales.  This is because of the different wording of s 5(1) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) (“the Law Reform Act”) which provides for the recovery of contribution from joint tort-feasors.  In Bialkower v Acohs Pty Ltd (1998) 83 FCR 1 at 11, the Full Court expressed the view that, because the cause of action under s 82 for a contravention of the TPA is entirely statutory in nature and is not an action in tort, s 5 of the Law Reform Act would not empower the Court to make a contribution order.  The TPA itself does not make provision for contribution orders save in respect of damage caused by contraventions of s 52:  as to which see Part VIA.

20                  There may, nonetheless, be scope for contribution claims to be brought in equity:  see Burke v LFOT Pty Limited (2002) 209 CLR 282.  In that case the High Court held that equitable contribution could be awarded where a respondent had contravened s 52 of the TPA.  No award was made, however, because of limitations on the application of the doctrine:  see at 294 (per Gaudron A-CJ and Hayne J) and at 300-303 (per McHugh J).

21                  It is sufficient for present purposes to observe that a respondent who wished to seek contribution from a fellow respondent following a trial in Sydney would confront far more legal difficulties than would the same respondent in a proceeding which was tried in Melbourne.  There is, therefore, a sound basis for the concerns, expressed by some of the respondents, that they would be prejudiced were the present application to transfer the proceeding to succeed. 

22                  The applicant has chosen to commence this proceeding in the Victoria District Registry.  It remains in its early interlocutory stages.  Having considered all of the matters raised by the parties, I can see no justification, in the interests of justice, for the proceeding to be transferred to the New South Wales District Registry.

23                  The applicant’s application will, therefore, be refused with costs.

24                  I should add that, had I been persuaded to transfer the proceeding, I would not have directed that it be placed in the docket of any particular judge in the New South Wales District Registry.  Docket allocation occurs in accordance with protocols established within particular registries of the Court.  It would not, in my view, be appropriate for a judge in another registry, who was unfamiliar with the case-load borne by particular judges in the registry to which a case was being transferred, and the competing demands on their time, to pre-empt local decisions in the receiving registry.  In some cases (and I do not suggest that this is one of them), questions of “judge shopping” might also arise.

Associate:

Dated:         11 December 2009