British American Tobacco Australasia Limited v Taleb

introduction 1 On 23 January 2013, I made the order set out above, for the reasons that follow. 2 By an interlocutory application dated 10 January 2013, the seventh respondent, Ms Zhi Liu, sought an order that this proceeding be transferred to the New South Wales District Registry of the Federal Court. 3 The application was supported by: 1. the affidavit of Ji Ying Jim Dai sworn on 10 January 2013; and 2. written submissions dated 16 January 2013. 4 The applicant, British American Tobacco Australasia Limited ("BATA"), opposed the application, contending that it should either be dismissed with costs or adjourned until after BATA's application for summary judgment, fixed for hearing on 6 February 2013, had been heard and determined. 5 BATA relied upon the following: 1. the affidavit of Georgina Pay O'Farrell sworn on 20 September 2012; 2. the affidavit of Thomas Edmund Kelleher sworn on 21 September 2012; 3. the affidavit of Daniel Roland Plane sworn on 16 January 2013; and 4. written submissions dated 16 January 2013. 6 By consent of the parties, the application was determined on the papers.

BACKGROUND 7 By a statement of claim dated 7 September 2012, BATA alleged that eight respondents infringed its Winfield trademarks by selling counterfeit Winfield cigarettes. Settlement subsequently occurred with six respondents and orders were made by consent on 1 November 2012 for BATA to discontinue proceedings in relation to those respondents. 8 On 5 December 2012, BATA filed an application for summary judgment against the remaining third and seventh respondents, which was fixed for hearing on 6 February 2013. 9 On 27 November 2012, the seventh respondent filed a defence. 10 On 5 December 2012 and 11 December 2012, BATA filed affidavits in support of its application for summary judgment. 11 On 13 December 2012, the solicitor for the seventh respondent informally advised the court and the applicant that she intended to make an application to transfer the proceeding.

relevant LEGISLATION AND PRINCIPLES 12 Section 48(1) of the Federal Court of Australia Act 1976 (Cth) provides: 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 a Judge imposes. 13 Rule 2.02 of the Federal Court Rules 2011 (Cth) provides: A party may apply at the proper place for an order that the proceeding be transferred to another place. 14 The principles applicable to an application for transfer are well established. In National Mutual Holdings Pty Ltd v Sentry Corporation (1988) 19 FCR 155, the Full Court stated (at 162, emphasis added): 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. … 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 … There is no onus of proof in the strict sense to be discharged by the party seeking to conduct or continue the proceedings elsewhere … 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. 15 In Lamb v Hog's Breath Co Pty Ltd (No 1) [2007] FCA 49 at [7], French J stated: The proceedings were commenced in the Perth Registry of the Court. The respondents seek its transfer to the Brisbane Registry. The question of the Registry from which the proceedings should be conducted does not raise matters of high principle. It is essentially a matter of case management and proper recognition of the legitimate interests of each of the parties reflected, in part, in the balance of convenience as between them and, of course, the convenience of the Court and any economies and efficiencies that may attach to one choice or another. These matters used to be more critically dependent upon choice of Registry than they are today and some of the earlier cases about the discretion to transfer from one Registry to another may have to be read in that context, without affecting the underlying criteria that inform this discretion. 16 While the decisions referred to above were made under the former Federal Court Rules, they continue to be applicable. In Essential Beauty Franchising Pty Ltd v Essential Beauty (Qld) Pty Ltd [2012] FCA 12, Mansfield J applied the above statements, which were made in relation to the former Federal Court Rules, to an application made under the Federal Court Rules 2011 (Cth).

Mr Dai's affidavit 17 Mr Dai, the solicitor for the seventh respondent deposed that: (a) On or about 16 November 2012, he received instructions to act for the seventh respondent, whose estranged husband provided him with documents received from the solicitors for the applicant dated 14 November 2012. (b) On or about 20 November 2012, Mr Dai met the seventh respondent and confirmed his instructions to act. (c) On 23 November 2012, the seventh respondent travelled to China to care for her elderly mother (who was suffering from diabetes) and planned to return to Australia in March 2013. (d) From August 2012, the seventh respondent left her business, known as Hang Lee Asian Food Market in Merrylands, New South Wales, to her estranged husband and instructed Mr Dai that she intended to sell or close the business as it was making considerable loss. (e) In China, the seventh respondent resided with her elderly mother in Jinlinpu Village, Nan'An City, Fujian Province, China, which had limited telephone and internet access. (f) Mr Dai communicated with the seventh respondent by a mobile phone application which was an internet-based messenger in the Chinese language, but the seventh respondent was not computer literate, spoke very limited English and did not know how to use emails. (g) When Mr Dai received documents served by the applicant's solicitors on 5 December 2012 and 11 December 2012, he unsuccessfully attempted to forward them to the seventh respondent, with whom he last communicated on or about 17 December 2012, when she instructed him to prepare the present application. (h) In support of the application to transfer, Mr Dai deposed that he was instructed and/or verily believed that: a) All allegations in the Statement of Claim took place in the state of New South Wales, more particularly in Sydney; b) The Seventh Respondent, along with all other Respondents, were residents in New South Wales; c) There is no prejudice for the Applicant to prosecute the proceedings in Sydney because the Applicant, as well as its legal representatives, all have offices based in Sydney. d) There are significant prejudices in legal and travel costs for the Respondents to defend these proceedings interstate.

The Seventh respondent's submissions 18 The seventh respondent denied selling counterfeit cigarettes in her business at 137 Merrylands Road, Merrylands, New South Wales, as alleged. 19 The seventh respondent submitted that: (a) the purchase transactions of the allegedly counterfeit cigarettes took place in suburban Sydney; (b) all the respondents operated their businesses in suburban Sydney; (c) the seventh respondent and all other respondents were residents of Sydney; (d) the investigator allegedly party to the sale transaction with the seventh respondent resided in New South Wales; (e) BATA had its registered office at Woolloomooloo, New South Wales; and (f) save that the solicitors with carriage of the matter (Corrs Chambers Westgarth) was based in Victoria, no Victorian participant was involved. 20 The seventh respondent further submitted that as Corrs Chambers Westgarth also practised in New South Wales, the New South Wales registry of this Court was the appropriate forum. Further, if the proceeding were transferred, BATA would suffer no prejudice, as its solicitors operated in New South Wales. 21 The seventh respondent submitted that, in contrast, it would be highly prejudicial to her if the matter were heard in Victoria, as she conducted a small local convenience store as a family business and would incur significant costs from defending interstate, including, but not limited, to: (a) engaging a solicitor in an unfamiliar jurisdiction; (b) inconveniences in the preparation of evidence and hearing; (c) additional costs in obtaining materials and court attendances for interlocutory matters; and (d) travel to Victoria to give evidence and to attend hearing.

bata's submissions 22 BATA submitted that: (a) (i) BATA had filed four substantial affidavits in support of its summary judgment application and did not anticipate that any witness would be required to attend the hearing of that application. If BATA were successful in its application for summary judgment, the proceeding (save for the quantification of damages or an account of profits) would be resolved. (ii) A transfer would very likely lead to delay (which may be quite significant) while the proceeding was allocated to a Judge in Sydney. (iii) The seventh respondent had delayed making her application, in circumstances where Mr Dai deposed that he first received instructions on 16 November 2012, met with the seventh respondent on 20 November 2012 and received instructions to make the transfer application on 20 December 2012. Although the seventh respondent filed a defence on 21 November 2012, she did not make the transfer application until 10 January 2013 and provided no explanation for the delay. (b) The transfer application should be refused or alternatively, the summary judgment stage of the proceeding (at least) should be completed in Melbourne in accordance with the current timetable, consistently with progressing the case efficiently and in a manner that is proportionate to its complexity. See s 37M of the Federal Court of Australia Act 1976 (Cth). (c) The convenience of the court favoured refusal of the application, as I was seized of the matter, had already determined one interlocutory application relating to the seventh respondent (see British American Tobacco Australasia Limited v Taleb (No 1) [2012] FCA 1065) and had made various orders, including: (i) interlocutory orders on 28 September 2012 and 1 November 2012 for the conduct of this proceeding; and (ii) final orders (by consent) in relation to the First, Second, Fourth, Fifth, Sixth and Eighth Respondents on 1 November 2012. (d) If the proceeding were transferred, another judge would have to familiarise himself or herself with the case, which, given the pending summary judgment application, would be an inefficient use of the court's resources. (e) Based on the information presently available, the location of witnesses did not favour a transfer to Sydney as, of the four substantive affidavits filed by BATA, two of the deponents (Wade Telley and Daniel Plane) were based in Melbourne, the seventh respondent had identified no witnesses (if any) on whom she would rely upon and the third respondent had not participated at all in the proceeding to date. Further, if BATA were successful in its application for summary judgment, the liability phase of the case would be completed without the need for any witnesses to attend court. (f) While its solicitors had a Sydney office, its anti-counterfeiting matters were managed exclusively by lawyers located in the Melbourne office. Prior to the commencement of the proceeding, BATA had retained counsel who now had detailed knowledge of it and had been involved in preparing BATA's application for summary judgment. (g) Although Mr Dai deposed that the seventh respondent would suffer prejudice in the form of legal and travel costs should the proceeding remain in Melbourne, the costs were not identified, explained or quantified. Further, the seventh respondent did not demonstrate that any additional legal and travel expenses she might incur (if she were required to travel to Melbourne) would be unduly onerous or beyond her means. (h) A transfer to Sydney would not eliminate the possibility that one of the parties would need to travel and incur the resultant costs. Rather, it would impose the need to travel on BATA's solicitors, counsel and witnesses. The potential cost would be shifted from one party to another, than eliminated, which did not promote efficiency. (i) The seventh respondent could retain Melbourne-based counsel for any appearances and she or her legal representatives could appear by video or (for procedural matters) by telephone. The seventh respondent was unlikely to attend the summary judgment hearing, as Mr Dai deposed that she was not scheduled to return from China until mid-March, and travel costs could consequently either be avoided altogether or minimised. (j) The allegations made by BATA did not call for the proceeding to be heard in Sydney and could be conveniently determined in the Melbourne Registry of the Federal Court, as they concerned a breach of a Commonwealth law and raised no issues of State law. (k) BATA commenced the proceeding against eight respondents, alleging the sale of counterfeit Winfield cigarettes. As BATA's anti-counterfeiting lawyers were based in Melbourne, where (contrary to the assertions of Mr Dai), the first and second respondents were also based, the choice of venue was not capricious.

Discussion 23 In the circumstances, I was not persuaded that there was a sound reason to transfer the proceeding to Sydney. The seventh respondent resides in Sydney, her business is based there and BATA's registered office is located in New South Wales, where a number of the respondents were also based. However, other respondents were based in Victoria, BATA's anti-counterfeit lawyers are based in Victoria and the proceeding was not commenced capriciously. 24 Nor did the nature of the allegations in any way favour a transfer of the proceeding. The proceeding has been on foot since 7 September 2012 and the seventh respondent's delay in making the transfer application was not satisfactorily explained by the communication difficulties to which Mr Dai deposed. A Melbourne judge was already relatively familiar with the matter and a forthcoming application for summary judgment (which was not suggested to require the attendance of witnesses) had the potential substantially to dispose of the proceeding. If it did not, there were, in any event, no details of any witnesses the seventh respondent intended to call or her proposed arrangements for legal representation, such as to indicate that the balance of convenience favoured transfer to New South Wales. Further, the convenience of BATA clearly favoured maintenance of the Melbourne venue, as its entire legal team and a significant proportion of its witnesses were based there. 25 I considered that a transfer of the proceeding at this stage would result in delay, disruption, duplication of work and inconvenience and inefficiency from the perspective of the court, for no obvious substantial gain. Any convenience accruing to the seventh respondent (which, given the lack of particulars, was impossible to gauge (and in procedural matters could be ameliorated by video or telephone link) would be offset by inconvenience to BATA.

Conclusion 26 Accordingly, the application to transfer the proceeding was refused. I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dodds-Streeton.