Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd and Anor

Federal Court of Australia|2004-03-01|Before: Conti J

REASONS FOR JUDGMENT 1 By notice of motion filed 9 February 2004, the first and second respondents ('respondents') seek a variety of orders relating to the cross-vesting of proceedings N 1509 of 2003 to the Supreme Court of New South Wales. This application is vigorously opposed by the applicant on a number of grounds, primarily on account of the fact that a hearing date was consensually agreed to by both parties and fixed on 2 February 2004 for early April of this year in this Court. 2 The criteria for cross-vesting proceedings from the Federal Court to the Supreme Court of a State are contained in s 5(4) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth) ('Cross-Vesting Act'). Although counsel for the respondents did not specifically refer to a subparagraph in s 5(4) of the Cross-Vesting Act on which he relied in his oral submissions on the motion (no written submissions were provided prior to the hearing of the motion, but rather reliance was placed on the affidavit of Benjamin Barrak, solicitor for the respondents, sworn and filed 9 February 2004), his argument broadly outlined leads me to conclude that he relied on sub-par (iii) of par (b) thereof, the full statutory context of which reads as follows: '(4) Where: (a) a proceeding (in this subsection referred to as the "relevant proceeding") is pending in the Federal Court or the Family Court (in this subsection referred to as the "first court"); and (b) it appears to the first court that: … (iii) it is otherwise in the interests of justice that the relevant proceedings be determined by the Supreme Court of a State or Territory; the first court shall transfer the relevant proceeding to that Supreme Court.' 3 The issue therefore arising is whether it is in the 'interests of justice' that the cross-vesting order sought by the respondents ought to be made. 4 The background to this matter, and a summary of the proceedings in the Supreme Court thus far to which counsel for the respondents seeks to have these Federal Court proceedings joined, is given in Mr Barrack's affidavit where the following appears: '2. The subject matter of these proceedings concerns the purchase by the applicant company of the property 5 Laman Street, Nelson Bay, ("the property"), and whether the Applicant has an implied licence to use the copyright in certain plans which copyright is owned by the First Respondent. 3. The circumstances in which the Applicant company acquired this property were by public auction conducted on 7 August 2003. 4. The property was purchased by the Applicant under contract from Anthony Stanislaus Carroll and Ross McDonald who were appointed as trustees for sale by orders of the Supreme Court of New South Wales in proceedings no. 4541 of 02. Messrs Carroll and McDonald were the registered proprietors of the property at the time of sale. 5. The 4541 of 02 proceedings are proceedings in which Mr Carroll and Mr McDonald were appointed trustees for sale and as a result of a dispute between Landmark Building Developments Pty Limited ("Landmark") as Defendant and Toyama Pty Limited ("Toyama") as Plaintiff, in which Toyama sought relief on account of the breakdown of a joint venture agreement between Landmark and Toyama concerning the development of the property by the joint venture. 6. These proceedings are now completed save for a notice of motion filed by Landmark in which Landmark seeks supervisory orders of the court, but seeks no relief against Toyama. So far as Landmark and Toyama are concerned, no further relief is sought by either one against the other in 4541 of 02 proceedings. 7. Ancillary to the 4541 of 02 proceedings is a set of proceedings no. 50099 of 2003 in which Landmark now sues Toyama Pty Ltd, Jeanette Haviland and others alleging breaches of the joint venture between Landmark and Toyama that gave rise to the 4541 of 02 proceedings. These proceedings are presently being case managed by Bergin J in the Commercial List of the Supreme Court of New South Wales. They are next returnable before Bergin J on 13 February 2004. 8. With respect to the proceedings before the Supreme Court of New South Wales, the outstanding issues in these proceedings so far as I am aware relate only to the service of expert reports. The proceedings can thereafter be reasonably anticipated to be allocated a hearing date. 9. Adjunctively to the 50099 of 03 proceedings, Toyama filed an application for consolidation of the 50099 of 03 proceedings with other proceedings alleged against it by Parramatta Design and Developments Pty Limited in the District Court of New South Wales. The application for consolidation was determined by Her Honour Bergin J on 7 November 2003. Her Honour ordered that the proceedings be joined in the same list, but that they would be allocated a separate proceedings no, being proceedings no 50172 of 03. 10. Issues to be determined in the 50099 of 03 proceedings and in the 50172 of 03 proceedings include: - i. the terms of the joint venture agreement between Toyama and Landmark, Haviland and one other.

ii. the terms of any retainer by the respondent in these proceedings to undertake design and supervisory work on behalf of the joint venture parties, Landmark and Toyama, Haviland and others;

iii. the basis upon which the Respondent in these proceedings was to be remunerated for its efforts in performing design works and construction for the joint venture parties, including the plans for development application no. 16-2000-103-1.

iv. The plans and designs with respect to development application 16-2000-103-1 are the plans subject to the first respondent's claim for copyright in these proceedings. … 15. The witnesses that the Applicant expects to call in the present proceedings are Mr Ghassan Fares. Mr Fares is the sole director of the first respondent and is the second respondent in the current proceedings. Mr Fares will be required to be called in both proceedings 50099 of 03 as he is a director of the Plaintiff in both these proceedings. 16. The Respondent in these proceedings will require the Applicant's witness Jeanette Haviland to be cross examined at length as to her evidence in the proceedings no 50099 of 03 and in the proceedings 50172 of 03, as well as in these proceedings. …

This Honourable Court has set aside 3 days in April 2004 for the matters subject of these proceedings to be heard. Having regard to the range of matters subject to requests for discovery by the Applicant in these proceedings, the length of the affidavits that the Applicant has filed in these proceedings and the ambit of material subject to the Applicant's subpoena in these proceedings, it may be inferred that these proceedings could run for the better part of 3 hearing days on the basis of the Applicant's case alone. 20. There are common questions of fact and law arising in the 50172 of 03 proceedings, the 50099 of 03 proceedings and in these proceedings, which issues of fact may be dealt with more efficiently on the basis of the orders sought in the accompanying notice of motion.' 5 The respondents advanced two interrelated reasons in support of their application, which can be summarised as follows: (i) the court's resources should not be applied to a case where another court, with jurisdiction to determine the current issues before this court, will hear the same evidence (this, it was submitted, would constitute at its highest a 'waste' of judicial resources); and

(ii) the respondents would incur the court costs of running two sets of proceedings in which the same 'factual matrix' is transversed, when another court could determine the current dispute that is a 'simple case about whether or not there is an implied licence to use copyright'.

In addition, it was submitted by Mr Hall of counsel, there is provision in Supreme Court proceedings for expedition, and moreover there is no reason why 'issues concerning expedition can't be ventilated exactly the same in that Court [the Supreme Court] as they would be here [the Federal Court]'. 6 Senior counsel for the applicant emphasised, however, the prejudice it would allegedly suffer if, as graphically expressed, it was now to be sent 'off to the wild blue yonder' for the following reasons: (i) the applicants are currently paying interest bills in excess of $4,000 per week (with no present return in value) on the purchase price they outlaid for the property, and wish to build the block of units at the earliest time; moreover they are said to be worried about the market 'crumbling, apart from everything else';

(ii) at all times beforehand, the respondents have been aware of the Supreme Court proceedings, and it has been only now, after a hearing date has been fixed in the Federal Court, that it made the present cross-vesting application - that being said to be 'a very unusual thing to do';

(iii) the respondents are currently in default of orders made by Bergin J in the consolidated Supreme Court proceedings and there is no indication of when a date will be fixed for the hearing of those proceedings; and

(iv) the prejudice the respondents claim in terms of costs in conducting proceedings before both the Supreme and Federal Courts would be less than that of the applicant, if cross-vesting does not occur, because if the cross-vesting order is otherwise to be made, the applicant would be drawn into complex and expensive proceedings in which they are at best 'a minor player'.

7 Counsel for the respondents' disputed those submissions, and particularly the applicant's need for an early hearing, on the basis that any prejudice thereby suffered would be self-imposed. In this context, it was claimed that the applicant was at all times on notice of the proceedings on foot in the Supreme Court, and possible legal action over any future use of the plans and designs the subject of the Federal Court proceedings. Clause 7.3 of the contract for sale of land - 2000 edition (which was, in part, also reproduced in the marketing material used to promote the sale of the subject property) reads as follows: The vendors disclose that a dispute exists in relation to the right to use the plans and designs which accompanied the Development Applications, including as to the existence of any licence to make use of the copyright in those plans and designs. The vendors further disclose that legal action has been foreshadowed in respect of future uses of those plans and designs.

8 Such an argument is flawed. The proceedings in this Court have been on foot since 7 October 2003, and have been already set down, implicitly by consent for hearing in the near future. At the time the hearing was fixed, the urgency for an early hearing was emphasised by the applicant. From the description given by the respondents of the apparently complex issues arising for determination in the Supreme Court, no identification of any commonality of issues with the single issue the subject of the present Federal Court proceedings has been distilled with precision. The fact that there may be certain common substrata of contextual circumstances has not been shown to be such as to require that the Federal Court proceedings be effectively put on hold, and be joined to the Supreme Court proceedings where additional parties and issues are clearly involved. 9 I am not persuaded I should accede to the present application for cross-vesting. The resolution of the copyright title to the subject plans and specifications is essentially a matter for a principled decision based on what appears to be a largely uncontested stratum of objective facts, or virtually so. It would be plainly inequitable, at this late stage in the proceedings, for the same to be in effect joined to other proceedings involving other parties and additional, more complex, issues. 10 I therefore dismiss the motion. Since the Federal Court proceedings are shortly to be heard, I will reserve the question of any award as to costs of the applicant until orders fall to be made in those proceedings. I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti.

Associate: Dated: 1 March 2004 Counsel for the Applicant: Mr B W Rayment QC and Ms P A Conway

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