Victorian Civil and Administrative Tribunal|2002-11-20|Before: Mr J, Gillard J, Kellam J

Bentley v Cash Resources [2002] VCAT 1399 (20 November 2002)

IN THE VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL

MEDIUM NEUTRAL CITATION: [2002] VCAT 1399

For David and Debra Bentley: Mr A Schlicht of Counsel instructed by Jerrard & Stuk Solicitors.

For Cash Resources Pty Ltd: Mr J R Dixon of Counsel instructed by Cornwall Stodart, Solicitors.

For Theodore Emmanouel Zervas: Mr H Obst, Solicitor, Minter Ellison, Solicitors.

For Lynette Anne Bentley: Mr J Gray of Counsel instructed by Tatchell Sheedy, Solicitors.

1. These four proceedings brought in the Civil Claims List of the Tribunal involve related parties and related issues. It is necessary to give a brief summary of the nature of each proceeding.

2. C775/2002 (to which proceeding C2938/2002) is a counterclaim).

By proceedings issued on 1 March 2002 David and Debra Bentley make claim against Cash Resources Australia Pty Ltd ("Cash Resources") that (inter alia) it had induced them into entering into a finance agreement in the principal sum of $308,000 by false, deceptive and misleading conduct within the meaning of the Fair Trading Act 1999 ("The Fair Trading Act"). Similar and related claims are made against the other two respondents. Final injunctive relief is sought by the applicants in this proceeding.

3. C888/2002 (to which proceeding C2937/2002 is a counterclaim).

By proceedings issued on 7 March 2002 Lynette Bentley makes claim against Cash Resources (and others) that (inter alia) she was induced to guarantee the funds borrowed by David and Debra Bentley the subject of the claim by them in proceeding C775/2002. She alleges (inter alia) that she was so induced by reason of unconscionable, misleading and deceptive conduct on the part of the respondents to the proceeding.

4. Compulsory Conferences were conducted in relation to each proceeding on 16 April 2002 and orders were made in relation to interlocutory matters. It was ordered that the proceedings be heard together.

5. It is relevant to note that in addition to the proceedings before the Tribunal, Cash Resources commenced a proceeding in the Supreme Court (No. 4846 of 2002) against Lynette Bentley (the applicant in proceeding C888/2002) and Malcolm Bentley (the secondnamed respondent in proceedings C775/2002 and C888/2002). This writ in the Supreme Court proceeding makes claim in relation to the same or similar issues as those before the Tribunal in these proceedings. On 12 July 2002 Gillard J stayed the Supreme Court proceedings pending the determination of the Tribunal proceedings involving the same parties, or further order of the Court. This order has been the subject of an appeal by Cash Resources, and as I understand leave to appeal has been granted but the Court of Appeal is yet to hear the appeal.

6. These proceedings in the Tribunal were listed before me for a directions hearing on 28 August 2002.

7. It was apparent that the proceedings involve a substantial sum of money and are complex. All parties agree that it will take two to three weeks to hear. Because a final injunction is sought in proceeding C775/2002 pursuant to s.123(2)(c) of the Victorian Civil and Administrative Tribunal Act 1998 ("the VCAT Act"), the proceedings may be heard only by a judicial member of this Tribunal. A case of this dimension is likely (as has already been demonstrated) to severely stretch the judicial resources of the Tribunal. It is a proceeding which is beyond the jurisdiction of the County Court. It involves a number of complex issues. For these reasons I invited the parties to be prepared to make submissions to me at the Directions hearing as to why the proceeding should not be stayed and referred to the Supreme Court on the basis of it being a "more appropriate forum" within the context of s.77 of the VCAT Act.

8. Upon the directions hearing commencing on 28 August 2002 Mr Gray of Counsel, who appears for Lynette Bentley submitted that the proceedings should not be stayed and referred to the Supreme Court. He provided me with helpful written submissions. His submissions may be summarised as follows:

(a) In circumstances where proceedings have been brought at VCAT prior to the commencement of any related proceedings in a court, VCAT has exclusive jurisdiction pursuant to ss.111 and 112 of the Fair Trading Act.

(b) s.111 of the Fair Trading Act applies to a proceeding in the Tribunal which raises issues under the Fair Trading Act and because it is a later provision, and deals specifically with trading disputes, should be applied in the preference to a general provision such as s.77 of the VCAT Act.

9. In the alternative, Mr Gray submits that s.77 of the VCAT Act has a parallel with an application to stay proceedings in a Court setting on the basis of forum non conveniens. He submits that the principles upon which s.77 should be applied are that -

(a) a defendant must discharge an onus of proof that the Tribunal is an inappropriate forum

(b) the interests of all the parties would be served suitably in the other forum

10. Mr Gray submits that the parties' interests would not be served by the proceeding being stayed and referred to the Supreme Court. First, he submits that his client would not have the financial resources to conduct a lengthy case against "several well resourced" respondents in the Supreme Court. Secondly, the pleadings and discovery have almost been completed at VCAT and if the matter was referred to the Supreme Court much legal cost already incurred would be wasted. Thirdly, he submits that it would be unfair to his client for the proceeding to be referred to the Supreme Court at this late stage in the proceedings. Finally, it is submitted that it would not be a valid exercise of power for VCAT to refuse to hear the proceedings because of, in part or whole, a lack of resources available to VCAT. The balance of convenience, Mr Gray submits is to be assessed by reference to the parties and not to the "judicial body".

11. I accept the submission of Mr Gray that the effect of s.111 of the Fair Trading Act is that a claim under the Fair Trading Act is not justiciable in a court in circumstances where the proceeding was first commenced at the Tribunal and has not been withdrawn or struck out for want of jurisdiction. Clearly the Supreme Court proceedings brought by Cash Resources were stayed on this basis by Gillard J on 12 July 2002. Furthermore, insofar as there is any inconsistency between s.77 of the VCAT Act and s.111 of the Fair Trading Act, by reason of s.159 of the VCAT Act, s.111 of the Fair Trading Act prevails to the extent of such inconsistency.

12. Accordingly the appropriate order to be made in consequence of this directions hearing is that the proceeding be set down for hearing. As stated above this case must be heard by a judicial member of the Tribunal. As stated by me in the course of the directions hearing the judicial resources of the Tribunal are stretched to such a point that a case of this dimension cannot be heard for some months by a Judge. At the directions hearing I stated that I was hopeful that a judge would be available to hear this case in November 2002. Regrettably it has not been possible to arrange a judge to hear this case in 2002 and accordingly it will be set down for hearing on 22 January 2003.

13. The issues raised by this proceeding are matters of concern for the Tribunal. Whilst the Tribunal routinely hears some thousands of Fair Trading cases each year, it is now becoming commonplace for large and complicated proceedings such as this proceeding, to be issued in the Tribunal. As noted above, the claims made in this proceeding put it beyond the jurisdiction of the County Court. Previous to the enactment of the Fair Trading Act such a claim would have been justiciable only in the Supreme Court or the Federal Court of Australia.

14. No doubt the ease of access to the Tribunal, the generally speedy disposition of proceedings and the cost provisions of s.109 of the VCAT Act are reasons why legal representatives of parties are choosing to commence such large and complex proceedings in the Tribunal.

15. Regrettably, the resources of the Tribunal in relation to the hearing of cases in the Civil Claims List are severely stretched. In the last four years the numbers of cases being issued in the Civil Claims List have more than doubled from under 2500 cases to over 5000 cases being issued per year. This has occurred without any significant increase in the resourcing of the Civil Claims List of the Tribunal. In 1999/2000, 81% of all cases issued were heard and determined within eight weeks. At the present time 81% of cases are heard and determined within 16 weeks. A growing number of large and complex cases of the type now under consideration has the capacity to severely damage the capacity of the List to deal with the volume before it unless serious consideration is given to increased resourcing of the List. That said, I accept the submission made by Mr Gray that inadequate capacity on the part of VCAT to hear Civil Claims cases would not be an appropriate basis to strike out a proceeding under s.77 of the VCAT Act. Nevertheless I do not accept his submission that the balance of convenience is to be assessed by reference to the parties alone. s.77 provides that an order to refer a proceeding to a more appropriate forum may be made on the Tribunal's own initiative. Furthermore, the Tribunal is empowered to strike out the proceeding if it considers that "the subject matter of the proceeding would be more appropriately dealt with" by (inter alia) a court. Whilst I accept that s.77 applies a forum non conveniens doctrine to the Tribunal and that it would need to be clear that the Tribunal was an inappropriate forum[1], nevertheless the wording of s.77(1) entitles the Tribunal to consider the "subject matter of the proceeding" in the consideration of whether there is a more appropriate forum. In my view, if the subject matter is complex, involves difficult issues of fact and law, and requires pleadings and case management processes which are more typical of processes adopted by the Supreme Court, an argument may well be advanced that such a case should be struck out and referred to the Supreme Court. However, as stated above, and by reason of the provisions of s.111 of the Fair Trading Act, these are not issues to be considered in the present proceedings.

[1] See Oceanic Sun Line Special Shipping Co Inc v Fay [1988] HCA 32; (1988) 165 CLR 197 and Schmidt v Won & Ors [1998] 3 VR 435.

Civil and Administrative Tribunal Act 1998

Bentley v Cash Resources [2002] VCAT 1399

At a glance

Court

Decision date

Before

Source

Judgment (31 paragraphs)

Bentley v Cash Resources [2002] VCAT 1399 (20 November 2002)

Parties

Legislation Cited (2)

Cases Cited (1)