Aiguille Pty Ltd v Caffissimo Holdings Pty Ltd as Trustee for the Caffissimo Franchising Unit Trust

National Practice Area: Commercial and Corporations

Sub-area: Commercial Contracts, Banking, Finance and Insurance

Number of paragraphs: 55

Date of last submissions: 2 March 2021 (Applicants) 9 March 2021 (Respondents) 26 February 2021 (The Trust Company (Australia) Ltd (ACN 000 000 993))

Date of hearing: 23 February 2021

Counsel for the Applicants: Mr MT Tolcon

Solicitor for the Applicants: Forbes Kirby Lawyers & Consultants

Counsel for the Respondents: Mr CE Chenu

Solicitor for the Respondents: Annabelle Hughes Solicitor

Counsel for the Trust Company (Australia) Ltd (ACN 000 000 993): Dr K O'Toole

Solicitor for the Trust Company (Australia) Ltd (ACN 000 000 993): James Chong Lawyers

BETWEEN: AIGUILLE PTY LTD (ACN 169 742 938) First Applicant

MICHELLE DIANE WOLSTENHOLME Third Applicant

AND: CAFFISSIMO HOLDINGS PTY LTD (ACN 108 765 699) AS TRUSTEE FOR THE CAFFISSIMO FRANCHISING UNIT TRUST First Respondent

order made by: JACKSON J DATE OF ORDER: 15 April 2021

1. The parties must confer as to orders disposing of the interlocutory application dated 20 October 2020, including as to costs and programming the matter to trial.
2. On or before 29 April 2021 the parties must provide to Jackson J's Chambers a minute of consent orders reflecting the outcome of the conferral or, if necessary, separate minutes of orders.
3. The action is listed for a case management hearing on 5 May 2021 at 9.45 am. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

JACKSON J: 1 This interlocutory application concerns whether this proceeding (the Franchise Action) should be heard together with proceeding WAD 223 of 2020 in this court (the Lease Action). 2 Both proceedings concern a café business operating under the Caffissimo franchise system which was located at the Phoenix Shopping Centre in Spearwood, Western Australia (Café Business). The first applicant in the Franchise Action, Aiguille Pty Ltd (Aiguille), acquired the franchise from the first respondent, Caffissimo Holdings Pty Ltd (Caffissimo), the master franchisor for the Caffissimo system, pursuant to a Franchise Agreement. The other applicants, Aiguille's directors Mr Evans and Ms Wolstenholme, gave guarantees of the Franchise Agreement. The applicants (Aiguille Parties) claim against Caffissimo and its director, the second respondent Mr Barr (Caffissimo Parties), for declarations that the Franchise Agreement and guarantees are void pursuant to s 243 of the Australian Consumer Law (ACL) and for monetary remedies. Caffissimo cross-claims against the Aiguille Parties for a range of monetary remedies. 3 The Lease Action is between the registered proprietor of the Phoenix Shopping Centre, The Trust Company (Australia) Ltd (Lessor) and Aiguille. Aiguille took a lease of the premises (Lease) from which the Café Business operated, Shop 38. It subsequently took another lease in the same shopping centre (of what I infer are smaller premises) to run a coffee shop known as Caffissimo Piccolo (Piccolo Business). The Lessor claims against Aiguille for damages for repudiation and other breaches of the Lease. It also claims against Mr Evans and Ms Wolstenholme, who gave guarantees of the Lease. The Aiguille Parties cross-claim against the Lessor for a declaration that the Lease is void and unenforceable, and for damages. 4 The Lease Action was commenced in the District Court of Western Australia. It appears that the parties to that proceeding agreed that it should be heard together with the Franchise Action, which has been ongoing in this court since 2017. The parties to the Lease Action consented to its transfer to the Supreme Court of Western Australia, apparently for the sole purpose of enabling it to be transferred to this court under the Jurisdiction of Courts (Cross‑vesting) Act 1987 (WA). The Supreme Court ordered the latter transfer by consent on 15 September 2020. 5 However Caffissimo, the respondent in the Franchise Action, opposes the application for the matters to be heard together. Caffissimo also claims that this court has no jurisdiction to hear the Lease Action in any event. All three sets of parties, that is, the Aiguille Parties, the Caffissimo Parties and the Lessor, made oral submissions on the subject at the hearing. 6 For the following reasons the proceedings will not be heard together, but they will be heard one after the other.

Jurisdiction 7 Before addressing the discretion to order that the matters be heard together, there is an issue about whether this court has jurisdiction to determine the Lease Action. Caffissimo submits that it does not. There was some force in that submission, as the Lease Action was simply brought under the Lease, as a breach of contract claim. While the cross-claim does allege that the Lessor made misrepresentations in a disclosure document it gave the Aiguille Parties before the Lease was signed, that was raised under the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA), not the ACL, and there was also a cross-claim under the tort of conversion. So on its face, the Lease Action did not raise a claim of a federal character which the Federal Court has jurisdiction to determine. The transfer of the Lease Action to this court under the Cross-vesting Act cannot of itself confer jurisdiction: Re Wakim, Ex parte McNally [1999] HCA 27; (1999) 198 CLR 511 at [111], [113], [118]-[119] (Gummow and Hayne JJ, Gleeson CJ and Gaudron J agreeing). 8 It may have been necessary to consider whether there was sufficient commonality between the Lease Action and the Franchise Action that they were both part of one justiciable controversy, where the court has jurisdiction to resolve the entire matter in the exercise of its federal jurisdiction. However the day before the hearing of this application, the Aiguille Parties provided a minute of proposed further amended defence and a minute of proposed further amended cross-claim to the court which they sought leave to file in the Lease Action. The latter minute includes claims under the ACL which, if they are permitted to be advanced, would clearly engage the jurisdiction of the court. 9 Nevertheless, at the hearing the Caffissimo parties queried whether the court had power to grant leave to amend a pleading if it did not have jurisdiction over the Lease Action as constituted by its extant pleadings. In view of the short notice of the proposed amendments which the Caffissimo Parties (and the Lessor) had received, the court directed the parties to give written submissions in relation to the query after the hearing, which they did. 10 The Caffissimo Parties submitted that while the court has a limited jurisdiction to determine whether it has the jurisdiction which has been purportedly invoked (see Khatri v Price [1999] FCA 1289; (1999) 95 FCR 287 at [15]), that 'would not extend to determining matters beyond the limited jurisdiction, such as whether leave ought to be granted to amend a claim to introduce new causes of action'. They cited no authority for the proposition I have put in quotation marks. The Lessor simply submitted 'a priori' that the court does not have power to grant the proposed amendments. 11 Plainly, if a federal claim is made in a cross-claim, that will attract the jurisdiction of this court provided that the cross-claim is not colourable, that is, not genuinely made, in the sense of being made in order to 'fabricate' jurisdiction: see Westpac Banking Corp v Paterson [1999] FCA 1609; (1999) 95 FCR 59 at [13]; Burgundy Royale Investments Pty Ltd v Westpac Banking Corporation (1987) 18 FCR 212 at 219. But if an order granting leave to amend is required for the claim to arise on the pleadings, does the court lack the power to grant leave simply because it has no jurisdiction over the claim on the unamended pleadings? 12 In Elders Ltd v Swinbank [2000] FCA 56; (2000) 96 FCR 303 the Full Court declared that the court had no jurisdiction to hear and determine a claim made under an insurance policy. The statement of claim did not make any claim having a federal character, but the applicant had applied for leave to amend it to expressly raise issues under the Insurance Contracts Act 1984 (Cth). The Full Court held (at [40]) that, federal jurisdiction not having already been enlivened, there was no basis on which the court had any authority to exercise the power of amendment under the court rules. But special leave to appeal to the High Court was granted and in a brief comment made at the hearing and disposition of the appeal (Transcript of Proceedings, Elders Ltd v Swinbank (High Court of Australia, A43/00, 13 August 2001) at 9 (Elders (High Court))), Gleeson CJ said: The Court is of the opinion that the Federal Court of Australia had jurisdiction to hear and determine the application for leave to amend made by notice of motion dated 17 November 1999 and that if the amendment was granted, the Federal Court would have jurisdiction to hear and determine the whole matter ... Because the respondent insurers do not now oppose the making of the amendment sought and will consent to its making, it is unnecessary to consider whether, as it is contended in this Court, the Federal Court otherwise had jurisdiction. 13 The High Court's decision remains unreported: see Swinbank v Elders Ltd [2002] FCAFC 270 at [5]. In that circumstance, and given the unusual form of the High Court's decision on the point, it is appropriate for me to also consider the issue on the basis of first principles in case there was some circumstance specific to Elders (High Court) which led to the decision as stated by Gleeson CJ. 14 Relevantly, this court has jurisdiction in any matter arising under any laws made by the Commonwealth Parliament: Judiciary Act 1903 (Cth) s 39B(1A)(c). The word 'matter' refers to the justiciable controversy: Abebe v Commonwealth of Australia [1999] HCA 14; (1999) 197 CLR 510 at [140] (Gummow and Hayne JJ). It is 'not necessarily the legal proceeding itself in exactly the form in which it was first presented': Abebe at [276] (Callinan J). A justiciable controversy is identifiable independently of the proceedings which are brought for its determination and encompasses all claims made within the scope of the controversy: Fencott v Muller (1983) 152 CLR 570 at 603. 15 So, for example, the court may have jurisdiction to determine a claim for preliminary discovery by virtue of the federal character of the underlying claim, which the prospective applicant may want to raise but has not yet raised. That is because the preliminary discovery sought must necessarily be granted before that claim can be raised: Hooper v Kirella Pty Ltd [1999] FCA 1584; (1999) 96 FCR 1 at [56]-[57], [60]-[61]. By analogy, a proposed amendment indicating that a party wants to raise, but has not yet raised, a federal claim (because it needs leave to do so) would, if not colourable, be enough to give rise to a matter with federal character giving the court the authority to grant leave. 16 Another analogous case is Polar Aviation Pty Ltd v Civil Aviation Safety Authority [2010] FCA 367; (2010) 267 ALR 530, in which Kenny J held that in a preliminary application for leave under the Limitation Act 1935 (WA) to bring a proceeding, a federal matter was raised by the proposed statement of claim. Her Honour held at [28] that: … the Court has jurisdiction to hear and determine the applicants' current application, upon the basis that the determination of the issues raised by it are ancillary or incidental to the exercise of judicial power in relation to the matter: compare Airservices Australia v Transfield Pty Ltd (1999) 92 FCR 200; (1999) 164 ALR 330; [1999] FCA 886 at [25] (Airservices) per Finn J. 17 Here, likewise, by raising the ACL in the proposed amendments to the cross-claim in the Lease Action, the Aiguille Parties are, 'bringing a matter forward which has within it a question under a federal statute': see Allsop J, 'An Introduction to the Jurisdiction of the Federal Court of Australia' (Federal Judicial Scholarship, 10 October 2007) at 27. So there is no reason to understand Elders (High Court) as anything other than what it appears on its face to be: binding authority which confirms here that the Federal Court has jurisdiction to determine any application for leave to amend in terms of the proposed cross-claim which the Aiguille Parties may make. 18 At the interlocutory hearing counsel for the Lessor indicated that his client would not be in a position to oppose the amendment if there were no issue of jurisdiction. In view of that position, and having determined for the reasons above that any prior lack of jurisdiction was not an impediment to granting leave to amend, I granted that leave administratively from Chambers on 6 April 2021. Counsel for Caffissimo conceded that if leave to amend in those terms were granted, there would be no doubt that the court had jurisdiction in respect of the Lease Action. The concession was properly made; the misleading or deceptive conduct claim under the ACL is at the heart of the dispute between the Aiguille Parties and the Lessor. 19 The question of the court's jurisdiction over the Lease Action having been resolved in this way, there is no need to consider other ways in which the court might be found to have jurisdiction. I will now proceed to consider the Aiguille Parties' application for the Franchise Action and the Lease Action to be heard at the same time.

Issues in the Franchise Action 20 The various claims and cross-claims in the Franchise Action raise a large number of issues. The following summary comes from the pleadings which have been filed in the Franchise Action. 21 As has been indicated, the action concerns the Franchise Agreement for the Café Business, which the applicants and Caffissimo executed in 2014. The applicants allege that in the months leading up to the Franchise Agreement, the Caffissimo Parties made representations to them, about staffing levels and the profitability of the Café Business, that the Café Business was under Caffissimo's management, and about whether it had an existing lease at the shopping centre. 22 According to the substituted defence that Caffissimo has filed, at the time of the negotiations, one Vivian Kopti was operating the Café Business as franchisee of Caffissimo. However, Caffissimo was the lessee of the premises under a 'casual leasing agreement' with the Lessor, and sub-let them to Ms Kopti. Also, it is said that Caffissimo owned the plant and equipment used in the Café Business. The making of the alleged representations concerning management and the existing lease is denied, the representation concerning profitability is admitted, and for the alleged representation concerning staffing levels, the Caffissimo Parties' main defence is that they were just passing on information received from Ms Kopti. 23 The Aiguille Parties allege that in reliance on the representations, Aiguille entered into an agreement with Caffissimo for the purchase of the Café Business. They say that they subsequently signed the Franchise Agreement and a disclosure document for the franchising of the Café Business. These are said to have breached Schedule 1 to the Competition and Consumer (Industry Codes - Franchising) Regulation 2014 (Cth) (Franchising Code of Conduct) in certain ways. The Aiguille Parties also allege that the Caffissimo Parties acted unconscionably in that regard in breach of s 20 of the ACL, because they did not afford the Aiguille Parties adequate time to read and understand the franchise documents and take advice. The Caffissimo Parties deny that the Aiguille Parties relied on any representations and the allegations about the franchising documents and unconscionable conduct are denied. 24 The Aiguille Parties claim that when Aiguille 'commenced its business', it became aware that the representations were false and misleading. Matters said to falsify the representations are pleaded, including that 320 total staff hours per week were needed to work the Café Business, rather than 198 hours per week as allegedly represented by the Caffissimo Parties. The Aiguille parties claim that this caused them to grossly underestimate the annual wages bill. It is said that the Café Business was in fact making a loss, and that the provision of financial statements by the respondents was a breach of the Franchising Code of Conduct. The Caffissimo Parties deny all of this. 25 It is also said that contrary to the representations, Caffissimo did not assign or sub-lease the lease of the premises, alternatively that there was no existing lease of the premises. So, in June 2014, Aiguille entered into the Lease with the Lessor for monthly rent and outgoings of $10,028.51. The Caffissimo Parties say that the Aiguille Parties knew that the Lessor would need to give them a new lease. 26 The Aiguille Parties allege that Caffissimo also failed to deliver the goodwill of the Café Business to Aiguille. This seems to be based on an allegation that the Café Business had no goodwill, because it had been poorly run by Ms Kopti, the previous franchisee. That is also said to have been unconscionable conduct in breach of s 20 of the ACL and misleading or deceptive conduct in breach of s 18. This is said to have the consequence that the Franchise Agreement is void and that the Caffissimo Parties are liable to the Aiguille Parties in damages. The Caffissimo Parties say that Ms Kopti delivered the goodwill of the Café Business to Aiguille. They deny that their conduct was unconscionable or misleading or that the agreement is void or that they are liable for damages. 27 The statement of claim also makes allegations of breach of an agreement arising out of a mediation that the parties attended in January 2016 concerning franchise royalties which it is alleged Aiguille owed to Caffissimo, along with allegations of misrepresentations and other conduct connected with the mediation. Broadly, Caffissimo denies these allegations. 28 There are further allegations in the statement of claim to the effect that the guarantee of the Franchise Agreement which Mr Evans and Ms Wolstenholme gave 'offends equity' and is void because, in broad terms, Caffissimo did not advise the Aiguille Parties of the implications of entering into the guarantee, and it was procured by Caffissimo solely for its benefit and by exploiting its superior bargaining position. In essence, Caffissimo denies all this. 29 The Caffissimo Parties cross-claim against the Aiguille Parties in the Franchise Action. The cross-claim is for breach of the Franchise Agreement in relation to the Café Business as well as a franchise agreement for the Piccolo Business. The latter agreement was entered into on or about 25 May 2015. Caffissimo alleges that Aiguille breached both of those agreements by abandoning the Café Business and failing to pay franchise service fees for it and for the Piccolo Business. Caffissimo also cross-claims against Mr Evans and Ms Wolstenholme under the guarantees of the franchise agreements which they gave. There is a related cross-claim for allegedly lost royalties in connection with roasted coffee as a result of Aiguille's abandonment of the Café Business. 30 The Aiguille Parties' defence to these cross-claims repeats their allegations of false representations and unconscionable conduct leading up to the purchase of the Café Business and the entry into the Franchise Agreement and says that on that basis, the Franchise Agreement and guarantees should be declared void. 31 Caffissimo also cross-claims for breach of the agreement arising out of the mediation, under which, it is pleaded, Aiguille would pay Caffissimo accrued franchise fees if Aiguille did not sell the Café Business and the Piccolo Business within 12 months, as well as a further franchise service fee from 21 January 2016. Aiguille's defence to this is that Caffissimo failed to give it all reasonable assistance to sell the Café Business and the Piccolo Business and repudiated the Mediation Agreement.

Issues in the Lease Action 32 The Lease Action relates to the Lease of Shop 38. The Lessor is the applicant and the Aiguille Parties are the respondents. The Caffissimo Parties are not parties to the Lease Action (and the Lessor is not party to the Franchise Action). The following summary of the issues comes from the pleadings in the District Court as now amended in accordance with the leave granted by this court. 33 The claim by the Lessor is straightforward. Aiguille entered into the Lease of Shop 38, which was undated but commenced on 1 July 2014. Mr Evans and Ms Wolstenholme guaranteed Aiguille's obligations under the Lease. In 2017 Aiguille is alleged to have abandoned the premises. The Lessor accepted the repudiation of the Lease said to have resulted. The Lessor claims rent arrears up to the time at which the repudiation was accepted and rent foregone for the balance of the Lease term. 34 The Aiguille Parties defend this claim on the basis that the Lessor breached the Lease and certain statutory obligations, entitling Aiguille to terminate the Lease. They claim that a disclosure document which the Lessor gave Aiguille under the Commercial Tenancy (Retail Shops) Agreements Act breached s 6 of that Act because it failed to disclose a number of matters, including that the prior tenant of Shop 38 was in default of its financial obligations under its lease and that the lease had been terminated by the Lessor. They make a cross-claim on the same factual basis for breach of s 18 of the ACL. The Aiguille Parties claim that as a result of the Lessor's 'failures and omissions', they believed that the prior tenant was meeting its rent obligations. Furthermore, the Aiguille Parties claim that these 'failures and omissions' meant that they did not have the ability to examine pertinent traffic statistics and that they were at a commercial disadvantage in bargaining with respect to the Lease. Misrepresentations are thereby alleged to have been made and it is said that, in reliance on them, Aiguille entered into the Lease and Mr Evans and Ms Wolstenholme gave the guarantee and have suffered loss and damage. This is said to mean that the Aiguille Parties are not liable to the Lessor at all. 35 The Aiguille Parties also allege that they have suffered loss or damage because Aiguille owned the plant and equipment at the Café Business, and the Lessor locked Shop 38 and re-let it on a short term basis to a third party without removing and storing the plant and equipment. This is said to mean that the Lessor committed the tort of conversion. 36 The Aiguille Parties also allege that the Lessor failed to mitigate any damage it suffered because it did not market Shop 38 for lease properly and, on about 1 October 2018, ended up leasing the premises to Caffissimo on less favourable terms than it would have obtained had it marketed Shop 38 properly. 37 I have already mentioned the basis on which the Aiguille Parties cross-claim in the Lease Action, namely alleged misleading or deceptive conduct and conversion of plant and equipment. In its defence to the cross-claim (not yet amended to take account of the amendments mentioned in these reasons), the Lessor broadly joins issue with the claims of misrepresentation, unconscionable conduct and breach of the Lease, either by way of non-admission or denial. The Lessor resists the claim for conversion on the basis that Caffissimo had, by the time Shop 38 was re-let, become the owner of the plant and equipment by seizing it pursuant to s 123 of the Personal Property Securities Act 2009 (Cth).

Principles 38 Rule 30.11 of the Federal Court Rules 2011 (Cth) provides: If several proceedings are pending in the Court and the proceedings: (a) involve some common question of law or fact; or (b) are the subject of claims arising out of the same transaction or series of transactions; any party to any of the proceedings may apply to the Court for an order that the proceedings be: (c) consolidated; or (d) heard together; or (e) heard immediately after one another; or (f) stayed until after the determination of any of the other proceedings. 39 In Humphries v Newport Quays Stage 2A Pty Ltd [2009] FCA 699 at [11] Besanko J gave the following useful list of factors that can be relevant when deciding whether to hear proceedings together: 1. Are the proceedings broadly of a similar nature? 2. Are there issues of fact and law common to each proceeding? 3. Will witnesses (lay and expert) in one proceeding be witnesses in one or more of the other proceedings? 4. Has there been an alternative proposal put forward that there be a test case and have the parties agreed to abide the outcome, or, at least, the determination of common issues of fact and law? 5. Is there a prospect of multiple appeals with substantial delays if the proceedings are not tried at the same time? 6. Will there be a substantial saving of time if the proceedings are tried at the same time, compared with each proceeding being tried separately? 7. Will an order that the proceedings be tried at the same time create difficulties in terms of trial management, complexity of procedural issues and difficulties in determining cross-admissibility of evidence? 8. Is one proceeding further advanced in terms of preparation for trial than the others? 9. Are there parties to one or some only of the proceedings who will be inconvenienced if all of the proceedings are tried at the same time? His Honour gave this list in relation to the predecessor of r 30.11 in the Federal Court Rules 1979 (Cth), the wording of which was materially the same.

Consideration 40 I accept that there are common questions of fact between the two proceedings which engage r 30.11, but it is relevant to the exercise of the discretion that they are not extensive. Subject to one qualification, the common issues which emerge from the pleadings as discussed above are confined to the position of the person who ran the Café Business from Shop 38 before Aiguille took it over. It may be that whether that person was in default under her lease from the Lessor, and whether the lease had been terminated, are matters that could (along with other facts) mean that the representations alleged to have been made by Caffissimo and the representations alleged to have been made by the Lessor were false or misleading. The qualification is that it was, in fact, unclear at the hearing whether the prior tenant who is relevant in the Lease Action was the same as the prior operator of the Café Business who is relevant in the Franchise Action, Ms Kopti. But I will proceed on the assumption that they were the same or were at least related parties. 41 The Aiguille Parties submitted that the common issues were more extensive than that, but I do not accept those submissions. First, they submitted that there was a common issue of who is liable to account to the Lessor for any outstanding rent and outgoings: Aiguille or Caffissimo? But this is stating the 'issue' at such a high level of generality as to be meaningless. In truth there is no claim that Caffissimo is liable to the Lessor directly. At most, it may be found that Caffissimo is liable to pay damages to Aiguille, which may go some way to compensating Aiguille for any liability it has to the Lessor. That is not a common issue. 42 Second, the Aiguille Parties refer to the quantum of the rental liability owed by Aiguille (or, it incorrectly submitted, Caffissimo) to the Lessor. It is true that the quantum of liability attributable to rent may be contentious in the Lease Action, because Aiguille alleges that the Lessor failed to mitigate its loss by accepting an offer to re-let Shop 38. But that issue is not going to be fought out in the Franchise Action. It may impact on the Franchise Action, as any liability of Aiguille to the Lessor may be part of the damages claimed by Aiguille in the Franchise Action. But that impact does not raise a question of fact or law that is common to the two proceedings. The outcome of the issue in the Lease Action will simply change one input into the calculation of any damages in the Franchise Action. 43 The same may be said of the third question the Aiguille Parties say is common to both proceedings, namely who was the owner of the plant and equipment that was employed in the Café Business. That is an issue in the Lease Action and the outcome may affect damages in the Franchise Action. But that does not make it an issue in the Franchise Action. There is, it is true, an allegation by the Caffissimo Parties that they were the owners of the plant and equipment, but that relates to the time before Aiguille acquired the Café Business, not the later time at which it is alleged to have abandoned Shop 38. 44 The fourth issue that the Aiguille Parties say is common to both proceedings is what Caffissimo and the Lessor knew about the previous business operations of the Café Business. It is not apparent why Caffissimo's knowledge is relevant to the question of the Lessor's liability for misleading conduct in the Lease Action, or vice versa or, in so far as the claims are based on s 18 of the ACL, why knowledge is relevant at all. Nevertheless, as I have said I accept that the question of Ms Kopti's performance as the operator of a Caffissimo franchise and as a tenant is a common question of fact between the two proceedings. In my view it is the only one. 45 Turning to matters relevant to the exercise of the discretion, it may be said that the proceedings are of a broadly similar nature. They are both civil proceedings in which Caffissimo and the Lessor seek payment under their respective agreements with Aiguille connected with Shop 38, and Aiguille seeks damages for allegedly misleading conduct. But the fact that they can be described in that way does not take the question of whether they should be heard together very far. 46 More importantly, as I have explained, the issues of fact that are common to each proceeding are limited. There will be background facts that are common to both proceedings, but it is not likely that they will be in issue in either proceeding. The Aiguille Parties submitted that if one of the proceedings is determined before the other, there will be likely to be issue estoppels or Anshun estoppels arising in one of the proceedings that will prejudice them in the other. That is not so, because the respective opponents of the Aiguille Parties in each action are different, and there is no suggestion of privity of interest between them, that is the Caffissimo Parties on the one hand and the Lessor on the other: see Tomlinson v Ramsey Food Processing Pty Ltd [2015] HCA 28; (2015) 256 CLR 507 at [23]. The doctrine of abuse of process could conceivably inhibit the Aiguille Parties' ability to put a claim in one of the proceedings that has been decided in another, but they articulated no way in which that could realistically occur. 47 Another factor raised by the Aiguille Parties has more weight in the exercise of the discretion. It is that the quantum of any liability of Aiguille to the Lessor as decided in the Lease Action may impact on the quantum of any liability of Caffissimo to the Aiguille Parties in the Franchise Action. That may give Caffissimo a legitimate interest in being heard in the Lease Action. But at the hearing counsel for Caffissimo submitted that his client would, at most, wish to make submissions in the Lease Action and would not adduce evidence. That being so, this factor, while relevant, does not provide a strong reason to hear the matters together. 48 I accept that there will be some witnesses that will be called in both proceedings. But given the relatively confined nature of the common issues of fact, I do not consider that those witnesses will be giving a great deal of evidence about the same matters in both proceedings. For example, while it seems likely that Mr Evans, a director of Aiguille, will give evidence about representations allegedly made to him by Caffissimo and by the Lessor, there is no suggestion that the representations were made on the same occasion, so his evidence about each set of representations will be distinct. Inconvenience to witnesses can be minimised by hearing one matter after the other. While that will require some witnesses to give evidence twice within a relatively short span of time, I do not consider that is a major inconvenience in the current circumstances. 49 Delay resulting from multiple appeals is not a strong concern here. Even if the proceedings are not heard together, that potential problem can be limited by the same judge hearing the matters one after the other and, potentially, publishing the judgments at the same time. If there are appeals on both matters no doubt the Full Court can deal with that in a pragmatic way, perhaps by hearing both appeals on the same day. 50 I do not consider that there would be a substantial saving of time if the proceedings are tried at the same time, compared with each proceeding being tried separately. That is because the commonality of contested factual issues is limited. I do not accept Aiguille's submission that most of the evidence to be called in one proceeding will need to be called in the other. I do, however, accept the submission of counsel for Caffissimo that if the actions are heard together, that may require his clients to incur the substantial unnecessary cost of its lawyers sitting through evidence and submissions in the Lease Action that are irrelevant to the Franchise Action. While directions for timetabling and giving parties leave not to attend throughout the trial can ameliorate that, in the present matter, because of the commonality of witnesses (but not issues), I foresee practical problems in making such directions. 51 Counsel for the Caffissimo Parties placed some emphasis on such difficulties of trial management, as well as the question of cross-admissibility of evidence. As I have said, some such difficulties may arise. But I do not consider that this issue by itself is determinative. It was determinative in Humphries v Newport Quays, but in that case the questions of cross-admissibility were much more contentious than I expect they would be in this case. These difficulties are not a strong factor here. 52 As for the relative state of advancement of each proceeding, it seems from the submissions that each party is ready for trial in both matters. This factor provides no impediment to hearing the matters together, although equally it suggests that they could be set down for trial one after the other.

Conclusion 53 Given that the common issues of fact between the proceedings are, in truth, limited, I do not consider it is appropriate to hear them together. I do not think that will result in a substantial saving of time and it is, in fact, likely to cause the Caffissimo Parties and the Lessor to incur wasted costs associated with matters that are not relevant to them. 54 Inconvenience to witnesses that are common to both proceedings, and the relatively low risk of inconsistent findings and multiple appeals, can be minimised by providing that the proceedings will be heard one after the other, by the same judge. Given the possible impact of any damages found in the Lease Action on the quantum of any damages ordered in the Franchise Action, it is appropriate for the Lease Action to be heard first. 55 I will not make substantive orders consequent on these reasons at this stage, but will set both proceedings down for a case management hearing and direct the parties to confer as to orders disposing of the interlocutory application, including as to costs, and programming both matters to trial. Any issue as to the costs of the interlocutory application will be determined at the case management hearing. I certify that the preceding fifty-five (55) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Jackson.