55025/03 EDEN CONSTRUCTIONS PTY LIMITED v
STATE OF NEW SOUTH WALES
JUDGMENT
1 HIS HONOUR: There were listed for hearing today two notices of motion. The first in point of time was the defendant's notice of motion filed 21 November 2003 seeking security for costs. For reasons that will be apparent from the transcript, the parties have accepted that that notice of motion should not proceed today.
2 The second notice of motion is the plaintiff's notice of motion filed 10 December 2003 for an order under s 6(3) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW), which I will call the Cross-vesting Act, that these proceedings be determined by this Court.
3 The requirement to consider s 6 of the Cross-vesting Act arises because it is common ground that an element of the plaintiff's case involves a special federal matter. That is the case pleaded in paragraphs 15 to 23 under the heading "Points of Claim" in part A of the plaintiff's further amended summons filed on 10 December 2003. The special federal matter is referred to in the further amended summons as "Misuse of Market Power". What is alleged is that the defendant had, and misused, its power in the market and thereby contravened s 46 of the Trade Practices Act 1974.
4 It is clear that this claim is a special federal matter as that expression is defined in s 3(1) of the Cross-vesting Act (which refers to the definition in the Jurisdiction of Courts (Cross-vesting) Act 1987 of the Commonwealth).
5 The claims that are pleaded in the points of claim are five in all. The first, pleaded in paragraphs 3 to 14, alleges that the defendant made a number of representations, concerning the plaintiff, that were false or misleading or misleading or deceptive; and, accordingly, that the plaintiff suffered damage. It is noteworthy that in this section of the claim the pleadings in paragraphs 7 and 8 make cross-reference to the market case.
6 The second part of the claim is that dealing with misuse of market power - the special federal matter to which I have referred.
7 The third aspect of the claim is pleaded in paragraphs 24 to 26B of the further amended summons. The plaintiff there asserts that the defendant failed properly to carry out its duties as a superintendent's representative under a contract relating to the Kremur Street pumping station and a contract for stormwater mitigation and associated civil works, each in Albury. That aspect of the claim is not cross-referenced to the market case.
8 The fourth aspect of the claim is pleaded in paragraphs 27 to 30 of the Points of Claim. It asserts that the defendant engaged in deliberate use of unlawful means in respect to the plaintiff's business by inducing or causing Albury Council to break its contract with the plaintiff, engaging in conduct in breach of the contract that is referred to, and misusing its market power. It is self-evident from this last point (see paragraph 27(c) of the Points of Claim) that this aspect of the case is cross-referenced to the market case. That is also apparent, in relation to this aspect of the case, from the particulars to paragraph 27 and the particulars to paragraphs 28 and 29.
9 The fifth aspect of the case is an assertion that the defendant has engaged in misfeasance in public office. That claim too is cross-referenced to the market case: see the particulars to paragraphs 34 and 35.
10 It is apparent that the whole of the case pleaded by the plaintiff against the defendant arises from the one factual matrix, or substratum of facts. So much was conceded in argument.
11 It is therefore necessary to consider the requirements of s 6 of the Cross-vesting Act. I set out the relevant provisions as follows:
"(1) If:
(a) a matter for determination in a proceeding that is pending in the Supreme Court of a State or Territory is a special federal matter; and
(b) the court does not make an order under subsection (3) in respect of the matter;
the court must transfer the proceeding in accordance with this section to the Federal Court or a court mentioned in paragraph (2)(b).
Note: This section has effect subject to section 6A (special federal matters: Commonwealth authorities or officers acting under the laws of States).
(1A) However, the court must only transfer so much of the proceeding as is, in the opinion of the court, within the jurisdiction (including the accrued jurisdiction) of the Federal Court, or the court mentioned in paragraph (2)(b), as the case may be.
…
(3) The Supreme Court may order that the proceeding be determined by that court if it is satisfied that there are special reasons for doing so in the particular circumstances of the proceeding other than reasons relevant to the convenience of the parties.
(4) Before making an order under subsection (3), the court must be satisfied that:
(a) a written notice specifying the nature of the special federal matter has been given to the Attorney-General of the Commonwealth and the Attorney-General of the State or Territory where the proceeding is pending; and
(b) a reasonable time has elapsed since the giving of the notice for the Attorneys-General to consider whether submissions to the court should be made in relation to the proceeding.
…
(6) In considering whether there are special reasons for the purposes of subsection (3), the court must:
(a) have regard to the general rule that special federal matters should be heard by the Federal Court or a court mentioned in paragraph (2)(b), whichever is appropriate in the particular case; and
(b) take into account any submission made in relation to the proceeding by an Attorney-General mentioned in subsection (4).
… ".
12 At one stage, it appeared to be asserted that those aspects of the plaintiff's case, which did not include the pleaded s 46 case, were not within the jurisdiction of the Federal Court of Australia. However, in my judgment, it is clear that in principle they are. Section 32(1) of the Federal Court of Australia Act 1976 (Cth) confers jurisdiction on the Federal Court, to the extent that the Constitution permits, in respect of matters not otherwise within its jurisdiction that are associated with matters in which the jurisdiction of the Court is invoked. That jurisdiction, which is frequently referred to as associated or accrued jurisdiction, has been considered by a number of authorities in the High Court starting with Phillip Morris Inc v Adam P Brown Male Fashions Pty Ltd (1981) 148 CLR 457 and concluding (in a different statutory context) with Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559.
13 The authorities were reviewed by Kenny J in Matland Holdings Pty Ltd v NTZ Pty Ltd [2002] FCA 1590. Her Honour referred at paragraph [16] to the judgment of Barwick CJ in Phillip Morris at 474, where his Honour said that, for something "to be outside the accrued jurisdiction" it:
"[m]ust be separate and disparate from the matter in relation to or in connection with which federal jurisdiction has been attracted."
14 His Honour said further that:
"The emphasis on the disparate and independent nature of what is not part of or within the matter should ensure that no narrow view is taken of the parameters of the matter."
15 At 475, his Honour said that it was settled in Australia that where a court that can exercise federal jurisdiction has its jurisdiction attracted in relation to a matter, that jurisdiction extends to the resolution of the whole matter.
16 Her Honour continued her review of the authorities and concluded at paragraph [22] that the Federal Court:
"[w]ill have jurisdiction to hear and determine the cross-claim in this proceeding, even though it raises no federal claim, if it shares a 'common substratum of facts' with the principal proceeding, or if the claims are related in the sense that the determination of one is essential for the determination of the other."
17 I respectfully accept her Honour's summary as setting out, more clearly than I could, the relevant principle on the attraction of non-federal jurisdiction to a case involving the exercise of federal jurisdiction.
18 It is, therefore, clear in my view that the Federal Court would have jurisdiction to hear the whole of the plaintiff's proceeding so that, among other things, it is not necessary to give further attention to the requirements of s 6(1A) of the Cross-vesting Act.
19 It is clear that s 6 expresses what might be called a strong bias in favour of transferring matters to the appropriate Federal Court where the proceeding involves a special federal matter. That follows from the requirement of subsection (3) that "special reasons" which do not include "reasons relevant to the convenience of the parties" must be found if this Court is to retain jurisdiction in the proceeding.
20 It is in my judgment clear that the five aspects of the plaintiff's claim arise from this common factual matrix or same substratum of fact. If there were any doubt about this, the extent to which the claims are intertwined, through the pleading mechanism that I have referred to already, would make it clear. It is, therefore, clear as I have said that the matter is one that the Federal Court could deal with.
21 It was put for the plaintiff that there were special reasons why the matter should remain in this Court. They included the proposition that the issues would involve analysis and consideration of matters and questions of a building and construction nature, which were appropriate to be heard by a court, such as this Court, having a specialist Technology and Construction List. The matters that were relied upon in this context included the tendering process; the procurement of building and construction works for government authorities; the role of the defendant (under whatever name) in the building and construction industry in New South Wales; and the practices of the defendant in relation to contract review lists, references, contract review reporting and like matters.
22 I do not think that those matters are such that the expertise of a specialist list is required to determine them. It is clear that at least some aspects of the plaintiff's case will require consideration of matters that are ordinarily, and properly, heard in this Court in this list. For example, the plaintiff's case in relation to the alleged failure of the defendant properly to carry out its duties as a superintendent's representative will involve, as paragraph 25 of the Points of Claim makes clear, whether the defendant properly performed its duties under the relevant contract and whether it properly assessed the work carried out by the plaintiff.
23 However, the case as pleaded and particularised does not appear to me to involve such specialist issues that it would be in a sense unfair to burden the Federal Court with them or, alternatively, highly desirable for them to be determined by this Court. In that context it may be noted that the plaintiff does not contend that the reference procedure for which Pt 72 of the Rules provides is appropriate. Ordinarily, the hallmark of a technical case can be found in the circumstance that reference of some or all the questions is desirable, so as to obtain the benefit of specialist assessment.
24 Accordingly, I am not satisfied that there are special reasons, within the meaning of s 6(3) of the Cross Vesting Act, for the proceedings remaining in and being determined by this Court.
25 It follows, from s 6(1), that the proceedings must be transferred to the Federal Court of Australia.
26 For the purposes of s 6(4) of the Cross Vesting Act, I am satisfied that notice has been given to the Attorney-General of the Commonwealth and the Attorney-General of the State and I am satisfied that each of them has indicated, by letter, that he does not wish to intervene or make submissions in these proceedings.
27 I therefore order, pursuant to s 6(1) of the Jurisdiction of Courts (Cross Vesting) Act 1987 (NSW) that proceedings number 55025/03 in this Court be transferred to the Federal Court of Australia.