FEDERAL COURT OF AUSTRALIA

Hamex Corporation Pty Ltd v Latrobe Street Ventures Pty Ltd (No 2) [2020] FCA 199

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 5(4) of the Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth) this proceeding be transferred to the Supreme Court of Victoria.

2.    The costs of the Defendants thrown away by reason of the transfer be reserved.

3.    Costs are otherwise reserved.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

ANDERSON J:

1    Today, on 25 February 2020, I made an order transferring this proceeding to the Supreme Court of Victoria. These are my reasons for doing so.

Background

2    This proceeding was commenced in March 2019 and is yet to be listed for trial. The background to the proceeding was set out in a previous interlocutory decision of Charlesworth J: Hamex Corporation Pty Ltd v Latrobe Street Ventures Pty Ltd [2019] FCA 1717 (First FCA Interlocutory Decision); see also the decision of Ierodiaconou AsJ in Lester v Lester [2018] VSC 611.

3    This proceeding involves, relevantly, a dispute between the second plaintiff, Damian Lester, and his father, the fourth defendant, David Lester. They are the two co-executors of the deceased estate of David’s mother, Masha Lester, (Estate) and the two co-trustees of the trusts established under her Last Will and Testament (Will). Damian and David are also beneficiaries under the Will (amongst others). In the First FCA Interlocutory Decision, Charlesworth J observed the following:

The sizeable Estate has been the subject of prior litigation between David and Damian in the context of a long running family dispute. Their relationship as co-trustees may be fairly described as dysfunctional.

Transfer to the Supreme Court of Victoria

4    The proceeding was listed before me today to hear two interlocutory applications in relation to the plaintiffs’ pleadings. However, five days ago, on 20 February 2020, the plaintiffs raised (in an affidavit sworn by the plaintiffs’ solicitor, Mr Allen Michael Burtt) that they would seek an order under the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth) that this proceeding be transferred to the Supreme Court of Victoria. Relevantly, s 5(4) of that Act requires the Federal Court to transfer a proceeding to a Supreme Court of a State or Territory where it is in the interests of justice that the proceeding be determined in that latter Court.

5    The plaintiffs’ transfer application was supported by the second, fourth and fifth defendants (collectively, parent defendants). Indeed, the parent defendants have been seeking for this dispute to be heard in the Supreme Court of Victoria for over two years. It is only very recently that the plaintiffs agreed with that course.

6    The first defendant (Latrobe) objected to the transfer. It submitted, broadly, that, given the plaintiffs had chosen to litigate this dispute in the Federal Court (going back to an antecedent application that was commenced in June 2017), and the plaintiffs had failed to take the many opportunities they had to seek a transfer until shortly prior to this hearing, the transfer application ought to be rejected. Latrobe also highlighted that the Federal Court was seized of the matter, and had jurisdiction to determine the issues currently before it.

7    Those submissions are all correct. However, for the reasons advanced by the plaintiffs and the parent defendants, my view is that it is in the interests of justice that this proceeding be determined by the Supreme Court of Victoria.

8    First, although the plaintiffs have unnecessarily delayed making a transfer application, the proceeding remains in an interlocutory phase, with outstanding disputes in relation to the plaintiffs’ pleadings yet to be determined. Transferring the proceeding at this relatively early juncture will not cause substantial prejudice to any party.

9    Second, although the Federal Court has jurisdiction to hear the current proceeding, and award the relief currently sought by the plaintiffs, the parties have foreshadowed that issues regarding the composition of the executorship and trusteeship under the Will are likely to arise. The Supreme Court, with supervisory jurisdiction over the administration of wills and trusts, is the natural forum for the resolution of these issues. Even if relevant aspects of the Trustee Act 1958 (Vic) are “picked up” by s 79 of the Judiciary Act 1903 (Cth), the Supreme Court has additional specialised procedures and powers for this form of dispute under O 54 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic).

10    Third, contrary to Latrobe’s submission, there is no impediment to the Supreme Court making an order in respect of costs incurred by the parties while this proceeding was pending in the Federal Court.

11    Fourth, although, as acknowledged by the parties, David is in poor health, his legal representatives may make an application to the relevant judge of the Supreme Court for expedition of the matter. For the record, I convey my request that the Supreme Court afford this proceeding such expedition as it deems appropriate by reason of David’s ill health.

12    Although the plaintiffs have initiated this transfer application, this is not a scenario where they bear an onus of justifying a change to the status quo, or that the current forum is clearly inappropriate: BHP Billiton Ltd v Schultz [2004] HCA 61; 221 CLR 400 at [14] per Gleeson CJ, McHugh and Heydon JJ. The court is purely required by statute to ensure that cases are heard in the forum dictated by the interests of justice. Moreover, that form of justice is not to be “disembodied, or divorced from practical reality”: ibid at [15].

13    Having regard to these principles, my view is that it is the interests of justice for the proceeding to be transferred to the Supreme Court of Victoria. This proceeding involves numerous issues regarding equity and trust law that are most appropriately determined by the Supreme Court, which has supervisory jurisdiction over the Will. By transferring the proceeding, there is reduced opportunity for disputes to arise in relation to the court’s jurisdiction. For these reasons, I made the following order:

1.    Pursuant to section 5(4) of the Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth) this proceeding be transferred to the Supreme Court of Victoria.

Costs

14    In the circumstances, I will also make the following orders as to costs:

2.    The costs of the Defendants thrown away by reason of the transfer be reserved.

3.    Costs are otherwise reserved.

Associate:    

Dated:        25 February 2020

SCHEDULE OF PARTIES