[2000] HCA 41
Akai Pty Ltd v People's Insurance Company Ltd (1996) 188 CLR 418
[2019] NSWCA 61
Bailey v New South Wales Medical Defence Union Ltd (1995) 184 CLR 399
[1995] HCA 28
Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256
[1995] HCA 24
Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1
Source
Original judgment source is linked above.
Catchwords
[2000] HCA 41
Akai Pty Ltd v People's Insurance Company Ltd (1996) 188 CLR 418[2019] NSWCA 61
Bailey v New South Wales Medical Defence Union Ltd (1995) 184 CLR 399[1995] HCA 28
Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256[1995] HCA 24
Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1[1999] HCA 59
CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345[1997] HCA 33
Dey v Victorian Railways Commissioners (1949) 78 CLR 62[1949] HCA 1
DRJ v Commissioner of Victims Rights (No 2) (2020) 103 NSWLR 692[1999] VSCA 100
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125[1964] HCA 69
Global Partners Fund Ltd v Babcock & Brown Ltd (in liq) [2010] NSWCA 196(2010) 79 ACSR 383
Grand Central Car Park Pty Ltd v Tivoli Freeholders [1969] VR 62
Hancock Prospecting Pty Ltd v Rinehart (2017) 257 FCR 442[2017] FCAFC 170
Henry v Henry (1996) 185 CLR 571[1996] HCA 51
in de Braekt v Legal Profession Complaints Committee [2016] WASCA 220
Inghams Enterprises Pty Limited v Hannigan [2020] NSWCA 82(2020) 379 ALR 196
Jackamarra (an Infant) v Krakouer (1998) 195 CLR 516[1998] HCA 27
Jane Doe v Fairfax Media Publications Pty Limited [2018] NSWSC 1996
Josephson v Walker (1914) 18 CLR 691
[1914] HCA 68
Karpik v Carnival plc [2023] HCA 39
(2023) 98 ALJR 45
King v Goussetis (1986) 5 NSWLR 89
Kinzett v McCourt (1999) 46 NSWLR 32
[1990] HCA 55
Wickstead v Browne (1992) 30 NSWLR 1
Judgment (11 paragraphs)
[1]
Background
The Plaintiffs (Respondents in this Court) are Angus Stone, Julia Stone, "Angus & Julia Stone Pty Ltd" (collectively, the Stones), and three other companies of which Mr Stone and Ms Stone are directors (the related companies). Mr Stone and Ms Stone are Australian musical performers who resided in New South Wales and Victoria respectively during the relevant period: PJ [115].
On 14 August 2015, the Stones entered into a management agreement (the Management Agreement) with HNOE Limited (HNOE) which is the first defendant in the proceedings and, together with MMM and Mr Manton, are the defendants to the Commercial List proceedings and the Applicants in this Court. HNOE is a London-based talent agency incorporated under the laws of England and Wales: PJ [2]. The Management Agreement was executed in California.
The related companies were not parties to the Management Agreement, nor were MMM and Mr Manton although Mr Manton is referred to in it. He is an artist manager, residing in New South Wales and the sole director of MMM, a company incorporated in Australia: PJ [6].
The Management Agreement provided that:
HNOE would be the sole and exclusive manager of Angus and Julia Stone in respect of their worldwide entertainment activities: cl 1.
The Stones would make commission payments to HNOE in the sum prescribed by the Management Agreement, which varied depending on the activity performed by the Stones: PJ [4].
HNOE must ensure that Mr Manton would provide management services for the Stones, at HNOE's own cost: cl 3.6.
The Management Agreement also contained cl 12.11 which was in the following terms:
"It is agreed between us that this agreement shall be subject to English Law and the High Court of Justice, Strand, London shall be the sole court of competent jurisdiction."
Nixon J held that the second half of this clause was in the nature of an exclusive jurisdiction clause or exclusive choice of court clause, as such clauses are sometimes described: Angus & Julia Stone Pty Ltd v HNOE Limited [2024] NSWSC 627 at [176] (primary judgment or PJ). There was no challenge to this characterisation of cl 12.11.
Prior to the Management Agreement being entered into, on 4 October 2013, MMM and HNOE entered an agreement (the MMM Agreement) whereby MMM undertook for Mr Manton to provide "artist management services as the lead manager of Angus & Julia Stone": PJ [7]. In return, MMM was entitled to invoice HNOE for 50% of commissions received by HNOE with respect to the Stone parties: PJ [59]. The Stones were not parties to this agreement and neither MMM nor Mr Manton was a party to the Management Agreement.
There was evidently an earlier agreement between Julia Stone and "Julia Stone Pty Ltd" (the Third and Sixth Plaintiffs) and Mr Manton made on or about 12 March 2013 by which Mr Manton was appointed the exclusive manager of the Third and Sixth Plaintiffs' activities in the music industry (the Manton Julia Agreement). No reference was made to this agreement in the original CLS, filed on 31 January 2024, although it was referred to in subsequent iterations of the CLS although in none of those iterations was it alleged to have been breached nor is it alleged that any commission payments were made under it.
The "Nature of the Dispute" as described by the Plaintiffs in the original CLS was said to be as follows:
"1 On 14 August 2015, the First, Second and Third Plaintiffs and the First Defendant entered into a Management Agreement by which the Plaintiffs agreed to appoint the First Defendant as the exclusive manager of the Plaintiffs' activities in the music and entertainment industry (Management Agreement).
2 The Second and Third Defendants provided management services to the Plaintiffs, including pursuant to the Management Agreement.
3 Pursuant to the Management Agreement, the Plaintiffs were obliged to, and did, make payments by way of commission to the Defendants.
4 The Management Agreement was terminated on about 2 June 2023.
5 The Plaintiffs contend that the Defendants have charged, and received, commission pursuant to the Management Agreement which is greater than their entitlement under that agreement, and in excess of the statutory cap imposed by Entertainment Industry Act 2013 (NSW) (EI Act), and have thereby breached that that agreement and the EI Act.
6 The Plaintiffs contend that they are entitled to damages, or restitution, against the Defendants arising from their breaches of the Management Agreement and the EI Act."
Paragraph 31 of the original CLS was to this effect:
"By reason of the breaches by HNOE of Clause 4.4 of the Management Agreement, and the overcharging of commission by the Defendants, the Plaintiffs have suffered loss and damage, including loss of at least $2,780,778.33 in the period between November 2015 and the date of these proceedings."
Notwithstanding that the Stones had commenced the Commercial List proceedings against HNOE in breach of the exclusive jurisdiction clause in the Management Agreement, the proceedings included parties (plaintiffs in the form of the related companies and defendants in the form of MMM and Mr Manton) who were not parties to the exclusive jurisdiction clause or the Management Agreement although it may be observed that what claims the related companies had, and what claims lay against MMM and Mr Manton, did not emerge from the description of the nature of the dispute in the original CLS.
The existence of these other claims and parties, however, was why the summary dismissal/strike out aspect of the notice of motion was strategically so important for, if the claims against MMM and Mr Manton were summarily dismissed or struck out, there would have been a powerful case for granting a permanent stay of proceedings by reason of the exclusive jurisdiction clause, in accordance with well established authority: see Karpik v Carnival plc [2023] HCA 39; (2023) 98 ALJR 45 at [66] (Karpik); Akai Pty Ltd v People's Insurance Company Ltd (1996) 188 CLR 418 at 427-429, 445; [1996] HCA 39 (Akai); Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 at 224, 259; [1988] HCA 32 (Oceanic); Global Partners Fund Ltd v Babcock & Brown Ltd (in liq) [2010] NSWCA 196; (2010) 79 ACSR 383 (Global Partners); Australian Health & Nutrition Association Ltd v Hive Marketing Group Pty Ltd (2019) 99 NSWLR 419; [2019] NSWCA 61 at [76]-[78] (Hive). The summary dismissal of the breach of statutory duty claims, especially those against Mr Manton and MMM, would have significantly diminished the existence of any "strong countervailing reasons" (Karpik at [66]) for not giving effect to the exclusive jurisdiction clause by a stay of the proceedings.
The primary judge was confronted with something of a moving feast. The notice of motion attacked the original CLS. In the course of the hearing of the notice of motion on 1 May 2024, it became tolerably clear, as will be explained below, that a key component of the Plaintiffs' claims alleging a breach of s 11 of the Entertainment Industry Act 2013 (NSW) (EI Act) disclosed no cause of action. Further evidence (in the form of the MMM Agreement) and submissions were filed by the Plaintiffs on 6 May which attached a proposed amended CLS (Draft ACLS) which sought to introduce a claim for breach of statutory duty, the relevant statute being the EI Act. The Draft ACLS also introduced a reference to the Manton Julia Agreement but did not allege that it had been breached and in [29], being the claim for breach of statutory duty, the only particulars of commissions charged in respect of which damages or restitution was sought were commissions charged by HNOE.
The Stones' submissions and the Draft ACLS were the subject of responsive submissions by the Defendants on 10 May and a further reply by the Plaintiffs on 14 May 2024. His Honour, with admirable despatch, delivered reasons on 24 May 2024.
In the event, the primary judge dismissed the notice of motion seeking a stay of proceedings but held that there were deficiencies in the Plaintiffs' claims in the CLS and Draft ACLS. As such, his Honour ordered that the Plaintiffs "file any application for leave to amend the Summons and/or the Commercial List Statement by 7 June 2024": PJ [186(1)]. As to the Manton Julia Agreement, the primary judge held at PJ [98] that it was:
"difficult to determine whether there is any viable claim in respect of the Manton Julia Agreement in circumstances where that claim is not raised by the existing CLS, and is foreshadowed in the Draft ACLS but in a rudimentary way, without any material facts pleaded regarding the term of the agreement, or regarding the amounts demanded or paid under the agreement and the dates on which those demands and payments were made"
An amended form of CLS, filed in accordance with his Honour's orders and differing from the Draft ACLS, was placed before this Court on the hearing of the application for leave to appeal even though it had not been before the primary judge. It is convenient to refer to it as the Filed ACLS. It represented a further iteration of the proposed pleading by the Plaintiffs and reference will be made to it in considering whether a stay should be granted on the re-exercise of discretion if it be the case that error be found in the approach of the primary judge, and in particular the failure summarily to dismiss the breach of statutory duty aspect of the claim which was at the heart of the argument in this Court.
Mr Flynn SC who, with Mr Beshara, appeared for the Applicants submitted that the Filed ACLS must be taken to represent the Plaintiffs' best attempt to formulate their breach of statutory duty claim after full argument at first instance. It would not have been in keeping with s 56 of the Civil Procedure Act 2005 (NSW) (Civil Procedure Act) to remit the matter to the primary judge to consider the Filed ACLS in circumstances where argument had been fully prepared for the purposes of this application for leave to appeal. A similar pragmatic approach was adopted by Wood CJ at CL, hearing an appeal from a decision of Master Harrison refusing to strike out an action for breach of statutory duty, in Preston v Star City Pty Ltd [1999] NSWSC 1273 at [2]-[3] (Preston).
At the heart of the argument in this Court was the primary judge's refusal to strike out or summarily dismiss the Stones' claims of breach of statutory duty. Importantly, the primary judge noted (at PJ [154]) that:
"since the question whether a claim for breach of statutory duty is available depends on the interpretation of the statute, it will not be affected by any evidence that may be led at trial, and that the Court therefore presently has all of the information it requires to determine this issue. Further, since each question of law has only one correct answer (Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541; [2018] HCA 30), it follows that the assertion that a claim for breach of statutory duty is available in respect of a contravention of the EI Act is, as a matter of law, either right or wrong."
Before turning to the primary judge's reasoning, it is necessary to set out some key provisions of the EI Act.
[2]
The Entertainment Industry Act
Section 11(1) which was at the heart of the Plaintiffs' claims provides:
11 Fees of performer representatives
(1) A performer representative must not demand or receive a fee or other remuneration from a performer under an entertainment industry agreement that exceeds the capped amount, unless the agreement is an entertainment industry managerial agreement and the additional services under the agreement are provided.
Maximum penalty--100 penalty units.
"Performer" is defined in s 4 of the EI Act as "any actor, singer, dancer, acrobat, model, musician or other performer of any kind who enters an entertainment industry agreement with a performer representative". An "entertainment industry agreement" is defined in s 4 as "an agreement between a performer and a performer representative to provide one or more of the services referred to in section 5".
Section 5 of the EI Act defines "performer representative" and the relevant services as follows:
Performer representative
In this Act, a performer representative means a person who, for financial benefit, provides or agrees to provide one or more of the following services to a performer (whether or not the agreement also provides for other services to be provided) -
(a) seeking or finding work opportunities for the performer,
(b) negotiating terms of an agreement for, and the conditions of, a performance,
(c) finalising arrangements relating to the payment of the performer,
(d) negotiating arrangements relating to the attendance of the performer at a performance,
(e) administering the agreement between the performer and an entertainment industry hirer,
(f) making arrangements for publicity attendances and related publicity responsibilities of the performer,
but does not include a person who does so solely as an employee of any such representative.
As noted above, s 11(1) of the EI Act prohibits performer representatives from charging performers under an "entertainment industry agreement" rates which exceed the "capped amount", subject to the exception set out in the balance of the provision.
The "capped amount" is defined by s 9(1)(a) of the EI Act as "the percentage, prescribed by the regulations, of the total amount payable to the performer for any performance in respect of which the performer representative provided services under an entertainment industry agreement".
[3]
The EI Act claim
Paragraph 29 of the original CLS was in the following terms:
"To the extent that HNOE, MMM and Manton have received in excess of 10% of the total amount payable to the Plaintiffs for any performances in respect of which HNOE, MMM and Manton provided services under the Management Agreement, HNOE, MMM and Manton:
a. have been in breach of ss 9 and 11 of the EI Industry Act;
b. have been in breach of their obligations pursuant to s 6 of the EI Act to establish a trust account for the benefit of the Plaintiffs;
c. is obliged to account, or provide restitution, to the Plaintiffs for the amounts received by HNOE and MMM in excess of 10% of the total amount payable to the Plaintiffs for any such performances, being (at least) $1,670,880.09.
Particulars
Schedule C hereto contains the summary of all of the commissions charged by HNOE, excluding the Back Catalogue commissions accounted for in Schedule B, which are in excess of 10% of the total amount payable to the Plaintiffs"
Reliance on ss 6 and 9 of the EI Act was abandoned.
The Draft ACLS addressed deficiencies in the way the claim in relation to the EI Act was pleaded by reframing it as a tortious claim for breach of statutory duty. Thus the "re-pleaded" [29] of the proposed Draft ACLS was in these terms:
"To the extent that HNOE, MMM and Manton have received in excess of 10% of the total amount payable to the Plaintiffs for any performances in respect of which HNOE, MMM and Manton provided services under the Manton Julia Agreement, HNOE Management Agreement, or the MMM Agreement, HNOE, MMM and Manton:
a. have been in breach of ss 9 and 11 of the EI Act and the statutory duty imposed by that section;
b. have been in breach of their obligations pursuant to s 6 of the EI Act to establish a trust account for the benefit of the Plaintiffs;
c. is are obliged to pay damages for breach of statutory duty, or to account, or provide restitution, to the Plaintiffs for the amounts received by HNOE, Manton and MMM in excess of 10% of the total amount payable to the Plaintiffs for any such performances, being (at least) $1,670,880.09."
In the Filed ACLS, [29] was further amended as follows:
"To the extent that HNOE, MMM and Manton have received in excess of 10% of the total amount payable to the Plaintiffs for any performances in respect of which HNOE, MMM and Manton provided services under the Manton Julia Agreement, HNOE Management Agreement, or the MMM Agreement, HNOE, MMM and Manton:
a. have been in breach of ss 9 and 11 of the EI Act and the statutory duty imposed by that section;
b. have received payments which were made pursuant to a mistake of law and, or in the alternative, demands which were made in breach of statutory duty and contrary to public policy and therefore were unlawful;
c. have been in breach of their obligations pursuant to s 6 of the EI Act to establish a trust account for the benefit of the Plaintiffs;
d. is are obliged to pay damages for breach of statutory duty, or to account, or provide restitution, to the Plaintiffs for the amounts received by HNOE, Manton and MMM in excess of 10% of the total amount payable to the Plaintiffs for any such performances, being (at least) $1,670,880.09."
[4]
The primary judgment in relation to the EI Act claims
The now Applicants advanced a number of arguments at first instance and on appeal attacking the Respondents' EI Act claims. These included that these claims were not available against MMM and Mr Manton because neither of them was a party to the Management Agreement or indeed any agreement with the Stones so that they could not have been in breach of s 11 of the EI Act, still less have committed the tort of breach of statutory duty, because s 11 required a demand or receipt of a fee or other remuneration from a performer under an entertainment industry agreement.
The Applicants also argued that the EI Act was not engaged because neither demand nor receipt of commissions occurred in New South Wales, and the EI Act was not intended to have extra-territorial operation. Reference was made in this context to this Court's decision in DRJ v Commissioner of Victims Rights (No 2) (2020) 103 NSWLR 692; [2020] NSWCA 242.
The more fundamental argument advanced by the Applicants, however, and one that, if correct, supplied a complete answer to the claims made for breach of statutory duty against all Defendants including HNOE was that, on the proper construction of the EI Act, no such private law action for breach of statutory duty was available.
The primary judge noted the following principles in respect of the Court's power summarily to dismiss proceedings:
the power must be exercised with caution (PJ [20]): Spencer v Commonwealth of Australia (2010) 241 CLR 118; [2010] HCA 28 at [24] (Spencer);
the Court must be satisfied that it has the necessary material and assistance from the parties to reach a "definite and certain conclusion that the lack of a cause of action is clearly demonstrated" (PJ [22]): General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 129; [1964] HCA 69 (General Steel);
"[t]here is greater scope for summary determination where the viability of a cause of action depends on a question of law, and no factual questions are involved": PJ [25];
if there exists a "real question to be determined, whether of fact or law" which the parties' rights depend upon, the Court cannot dismiss the action as "frivolous and vexatious and an abuse of process" (PJ [23]): Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at 91; [1949] HCA 1; and
[5]
Consideration
It will have been observed that there were two strands to his Honour's reasoning. The first was set out in PJ [157], namely his Honour's view that, having regard to the parties' competing contentions, there was a debatable question of law.
In General Steel, Barwick CJ said at 130 that:
"Although I can agree… that the defendant should be saved from the vexation of the continuance of useless and futile proceedings, in my opinion great care must be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal. On the other hand, I do not think that the exercise of the jurisdiction should be reserved for those cases where argument is unnecessary to evoke the futility of the plaintiff's claim. Argument, perhaps even of an extensive kind, may be necessary to demonstrate that the case of the plaintiff is so clearly untenable that it cannot possibly succeed." (emphasis added)
The emphasised portion of this passage was quoted with approval by Gummow and Hayne JJ, albeit in dissent on the facts, in Jackamarra (an Infant) v Krakouer (1998) 195 CLR 516; [1998] HCA 27 at [35] (Jackamarra). Referring to the issue of whether a matter was "arguable", their Honours had said that:
"If it means no more than that counsel, acting responsibly, can formulate an argument which can properly be advanced in support of the appeal, the test is too loose; if it is clear that that argument will fail, the appeal should not proceed. To permit it to proceed is to subject the respondent to the many costs of litigation needlessly and is to occupy the courts when they could be occupied more productively."
This aspect of their Honours' judgment was referred to in Boensch v Pascoe (No 2) [2017] FCA 146 at [27]-[30] per Gleeson J, in Longreach Family Living (Vic) Pty Ltd v Simonds Homes Melbourne Pty Ltd [2013] VSCA 274 at [56] and in in de Braekt v Legal Profession Complaints Committee [2016] WASCA 220 at [43]-[44].
In Spencer at [55], Hayne, Crennan, Kiefel and Bell JJ, having referred to General Steel, said that "the test to be applied was one of demonstrated certainty of outcome".
In Lepcanfin Pty Ltd v Lepfin Pty Ltd (2020) 102 NSWLR 627; [2020] NSWCA 155 at [96]-[99], Payne and McCallum JJA agreed with the following observations made by me in that case:
"[96] The first point to be made is that, in an appropriate case, and recognising the need for due caution, a legal question, even one involving some complexity, may be disposed of in a summary fashion. As Barwick CJ said in a well- known passage in General Steel…:
'… I do not think that the exercise of the jurisdiction should be reserved for those cases where argument is unnecessary to evoke the futility of the plaintiff's claim. Argument, perhaps even of an extensive kind, may be necessary to demonstrate that the case of the plaintiff is so clearly untenable that it cannot possibly succeed.'
[97] Accordingly, to the extent that the first and second grounds of appeal complained that the matter was dealt with on a summary basis and that the construction posited by the applicant was not obviously untenable and was 'reasonably arguable', these arguments need to be assessed with Barwick CJ's observations in General Steel in mind. They also need to take into account the matter candidly conceded by Ms Whittaker that I have noted at [64] above, namely that the issue was essentially a question of construction. As Isaacs J said in Harrington v Browne (1917) 23 CLR 297 at 307; [1917] HCA 36, there can be only one construction given to a contract. See also Life Insurance Company of Australia Ltd v Phillips (1925) 36 CLR 60 at 78; [1925] HCA 18.
[98] In the circumstances of the present case, it was both open and appropriate, in my opinion, for the primary judge to dispose of the matter on a summary basis. The primary judge's construction was, in my opinion, correct."
[6]
The action for breach of statutory duty
The EI Act confers no relevant express private cause of action for breach of s 11(1) of the Act. That is the necessary starting point for the analysis. Accordingly, if such a cause of action is available, it can only arise by a process of implication from the subject matter, scope and context of the Act.
Where no private right of action has been created, the legislature not having expressed any intention on the subject, Sir Owen Dixon observed that "an interpretation of the statute, according to ordinary canons of construction, will rarely yield a necessary implication positively giving a civil remedy": O'Connor v S P Bray Ltd (1937) 56 CLR 464 at 477-478; [1937] HCA 18 (O'Connor) (emphasis added). So much was reaffirmed by Gummow J in Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1; [1999] HCA 59 at [157]. See also Porter v OAMPS Ltd [2005] FCA 232; (2005) 215 ALR 327 at [110].
Dixon J in O'Connor, having pointed to some cases in this area which he politely suggested were informed by "… very general considerations without either the authority of any general rule of law or the application of any definite rule of construction", went on to attempt to formulate his understanding of the true nature of the principle. Thus, he said at 478 that:
"Whatever wider rule may ultimately be deduced, I think it may be said that a provision prescribing a specific precaution for the safety of others in a matter where the person upon whom the duty laid is, under the general law of negligence, bound to exercise due care, the duty will give rise to a correlative private right, unless from the nature of the provision or from the scope of the legislation of which it forms a part a contrary intention appears. The effect of such a provision is to define specifically what must be done in furtherance of the general duty to protect the safety of those affected by the operations carried on."
Two matters may be observed about this passage. First, it may be doubted that any "wider rule" has been deduced in the almost 90 years since O'Connor apart, perhaps, from Kitto J's observation in Sovar which focussed the interpretative inquiry on what may be inferred from the nature, scope and terms of the statute. Secondly, an important aspect of Dixon J's formulation was that any implied statutory duty would generally exist adjacent to an existing common law duty of care. Kitto J emphasised this aspect in his decision in Sovar at 404-405; see also Anderson v Mackellar County Council (1968) 69 SR (NSW) 444 at 448 per Jacobs JA; Pask v Owen [1987] 2 Qd R 421 at 427 per Andrews CJ; Jane Doe v Fairfax Media Publications Pty Limited [2018] NSWSC 1996 at [117], [138] (Jane Doe) per Fullerton J. Pausing there, in relation to the present case, no pre-existing duty of care was said to be owed by a promoter to an artist in relation to the charging of commission, that traditionally being a matter determined contractually. This tends against the existence of any statutory duty: Askin v Knox [1989] 1 NZLR 248 at 253; Willis v Castelein [1993] 3 NZLR 103 at 113; Field v Dettman [2013] NSWCA 147 at [44] (Field); see also C Sappideen et al, Fleming's The Law of Torts (11th ed, 2024) at [16.20].
[7]
No action for breach of statutory duty available
Applying these principles, it seems to me to be clear that no common law claim for breach of statutory duty was intended to be created by the legislature when passing the EI Act or indeed its predecessor Act.
Any such intention would need to be divined from the scope and context of the EI Act. Far from providing any support for the existence of such a duty, the provisions of the Act point strongly against it.
Perhaps the most prominent such provision is s 20, reproduced at [30] above. The existence of potential relief from the Industrial Relations Commission puts the present case on extremely close footing to both Martin and Josephson, and brings the case into the general rule enunciated by Jordan CJ in Martin, as discussed above at [66].
This conclusion is only reinforced, however, when other remedial features of the EI Act are considered. Thus, as was emphasised by Mr Flynn, ss 21 and 22 provide for the acceptance and enforcement of undertakings for suspected breaches; ss 24 and 25 of the EI Act provide a show cause mechanism which operates where a performer representative has engaged in unlawful conduct (defined in s 4 as a breach of the code of conduct or of a provision of the Act) which may result in entertainment industry prohibition orders being obtained from the Supreme Court. Importantly, s 25(3) provides that:
"The Supreme Court may also, if the Court is satisfied that a person has sustained loss or damage as a result of the unlawful conduct of the person against whom the order is made, order the person to compensate the other person for the loss or damage."
This analysis is fortified by the fact, already mentioned, that the statute did not supplement any pre-existing duty of care, as to which see the authorities referred to in [63] above.
Next, there is also s 43 of the Act providing for civil penalties. Mr Philips, who appeared for the Respondents, correctly pointed out that that section does not include a breach of s 11 of the Act (for which a criminal penalty is prescribed). It does, however, apply to a breach of the code of conduct, cl 2(8) of which imposes an obligation on a performer representative to use best endeavours to ensure that employees comply with the Act and the code of conduct.
The only other textual argument advanced by Mr Philips in support of the contention that a breach of s 11 generated a common law right of action was s 43(5), to the effect that "[e]vidence given in proceedings for the recovery of money is not admissible in proceedings for a civil penalty". His submission was that this was a legislative indication that the legislature contemplated an action for breach of s 11. I disagree.
[8]
The restitution claims
Before turning to a re-exercise of the discretion, it is necessary to say something at this point in relation to the Stones' claims for restitution, raised in ground 2(e) of the draft notice of appeal.
As against HNOE, whatever other difficulties the restitution claims may face (a matter which was the subject of specific submissions by the Applicants), the claim for restitution against HNOE fell within the scope of the exclusive jurisdiction clause. That clause, it will be recalled, relevantly provided that "the High Court of Justice, Strand, London shall be the sole court of competent jurisdiction".
There is a degree of ellipsis in this clause in that it is silent in terms of its subject matter scope, that is to say, it does not take the familiar form of such clauses which use relational or connective phrases such as "all disputes arising out of or connected to this contract shall be determined in the courts of …". That, however, does not mean that it should be narrowly construed. To the contrary, the established approach in both Australia and England to the construction of such clauses is to accord them a liberal, broad or generous interpretation, giving effect to the "rational assumption of reasonable people by giving liberal width and flexibility where possible to elastic and general words of the contractual submission to [jurisdiction], unless the words in their context should be read more narrowly": Hancock Prospecting Pty Ltd v Rinehart (2017) 257 FCR 442; [2017] FCAFC 170 at [167]. As Spigelman CJ observed in Global Partners at [67], in identifying the rationale for the broad construction of arbitration and exclusive jurisdiction clauses:
"A significant purpose of an exclusive jurisdiction clause is to ensure that all disputes are determined in a coherent manner by a single jurisdiction. There is a clear commercial interest in minimising the possibility of a dispute being determined by multiple tribunals, with the consequent prospect of divergent findings. Furthermore, the parties, in advance, have determined that a particular jurisdiction is acceptable to them, both in terms of the speed and efficacy of its civil dispute resolution procedures and for the competence and skill of its judges and lawyers."
The generally broad approach taken to the construction of the scope of jurisdiction clauses was considered at some length in Inghams Enterprises Pty Limited v Hannigan [2020] NSWCA 82; (2020) 379 ALR 196 at [53]-[67]. In Nyunt v First Property Holdings Pte Ltd [2022] NSWCA 249; (2022) 408 ALR 277, I noted that the jurisdiction clause in the Joint Venture Agreement in that case contained an ellipsis in the sense that, by that clause, both parties submitted to the jurisdiction of the Courts of Singapore but the clause was silent in respect of the scope or extent of that submission: at [95]. At [98], I held that "[w]here, as in the present case, the parties did not seek to delimit the scope of their submission to jurisdiction by specifying any nexus at all, it may readily be inferred that their intention was to cast the net very broadly indeed". See also Qantas Airways Ltd v Rohrlach [2021] NSWCA 48; (2021) 304 IR 218 at [60]-[67].
[9]
Re-exercise of discretion
Error having been established bearing upon the exercise of the primary judge's discretion, that discretion falls to be re-exercised.
The relevant principles bearing upon the exercise of the discretion in a case such as the present have been set out in cases such as Global Partners and Hive. These and many other cases emphasise the important role that exclusive jurisdiction clauses play in commercial agreements. In Hive at [76], I observed that:
"It is scarcely surprising that common law courts have traditionally supported such arrangements by manifesting a strong disposition towards the enforcement of such clauses whilst never accepting that private parties can "oust" the court's jurisdiction by such agreements. In Australia, this approach is based upon a series of decisions of the High Court (see Huddart Parker Ltd v The Ship "Mill Hill" (1950) 81 CLR 502; [1950] HCA 43 (Huddart Parker); Compagnie des Messageries Maritimes v Wilson (1954) 94 CLR 577; [1954] HCA 62; Akai at 427-9 and 445), and a similar robust approach to the enforcement of such clauses is readily discernible in other jurisdictions, at least where such clauses are between commercial parties dealing with each other at arm's length: see, for example, Donohue v Armco Inc [2001] UKHL 64; [2002] 1 Lloyd's Rep 425 (Donohue v Armco) (England); Vinmar Overseas (Singapore) Pte Ltd v PTT International Trading Pte Ltd [2018] SGCA 65 at [112] (Vinmar) (Singapore); Pompey Industrie v ECU-Line NV [2003] 1 SCR 450 (Canada); M/S Bremen v Zapata Off-Shore Co, 407 US 1 (1972) (United States); Kidd v van Heeren [1998] 1 NZLR 324 (New Zealand)."
I indicated in Hive at [78] that the case law discloses not so much a "test" for or governing the exercise of discretion in this area but rather an approach which begins with a "firm disposition in favour of maintaining [the] bargain unless strong reasons be adduced against a stay" which has been described as a "prima facie position": Akai at 445.
The position is more complicated where claims by or against non-parties to the exclusive jurisdiction agreement are also included in the proceedings. Hive was just such a case as was Global Partners. The presence of such claims may, but not necessarily will, provide strong reasons against the grant of a stay of proceedings by reference to an exclusive jurisdiction clause between some but not all of the parties to the litigation. In Hive at [90], I indicated that:
"The importance of holding parties to their bargain is a very powerful consideration but is not one that should be elevated or given some special status in the hierarchy of factors where not all parties to the dispute are parties to the exclusive jurisdiction clause."
[10]
Conclusion and orders
I propose the following orders:
1. Grant leave to appeal.
2. Appeal allowed with costs.
3. Set aside the orders of the primary judge and in lieu thereof, order that:
1. the proceedings be stayed;
2. the plaintiffs be ordered to pay the costs of the notice of motion filed on 15 March 2024.
LEEMING JA: I agree with Bell CJ for the reasons that his Honour gives that this Court should intervene, allow the appeal and stay the proceedings. As the Chief Justice explains, that is principally because the claim for damages for breach of statutory duty is bad in law, while the restitutionary claims for recovery against HNOE fall within the scope of the exclusive jurisdiction clause. Without detracting from the comprehensive reasons of the Chief Justice, I would add the following.
The passage in Barwick CJ's reasons, sitting in the original jurisdiction of the High Court, in General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 130; [1964] HCA 69 is familiar but also, with respect, somewhat opaque as to its application in any particular case:
in my opinion great care must be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal. On the other hand, I do not think that the exercise of the jurisdiction should be reserved for those cases where argument is unnecessary to evoke the futility of the plaintiff's claim. Argument, perhaps even of an extensive kind, may be necessary to demonstrate that the case of the plaintiff is so clearly untenable that it cannot possibly succeed.
More recently, the joint judgment in Agar v Hyde (2000) 201 CLR 552; [2000] HCA 41 at [57] observed that "[t]he test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way." The joint judgment in Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256; [2006] HCA 27 at [46] cautioned that the statements in General Steel should not be given "canonical force". In Shaw v State of New South Wales [2012] NSWCA 102 at [32], Barrett JA (with whom Beazley, McColl and Macfarlan JJA and McClellan CJ at CL agreed) enunciated the test thus:
The question is ... whether the claims in question are so obviously untenable or groundless that there is "a high degree of certainty" that they will fail if allowed to go to trial; and whether this is one of the "clearest of cases" in which the court may accordingly intervene to prevent the claims being litigated.
[11]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 19 November 2024
demnity Association (1997) 41 NSWLR 559
FAI General Insurance Co Ltd v Ocean Marine Mutual Protection and Indemnity Association (1997) 41 NSWLR 117
Field v Dettman [2013] NSWCA 147
Gardiner v Victoria [1999] 2 VR 461; [1999] VSCA 100
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; [1964] HCA 69
Global Partners Fund Ltd v Babcock & Brown Ltd (in liq) [2010] NSWCA 196; (2010) 79 ACSR 383
Grand Central Car Park Pty Ltd v Tivoli Freeholders [1969] VR 62
Hancock Prospecting Pty Ltd v Rinehart (2017) 257 FCR 442; [2017] FCAFC 170
Henry v Henry (1996) 185 CLR 571; [1996] HCA 51
in de Braekt v Legal Profession Complaints Committee [2016] WASCA 220
Inghams Enterprises Pty Limited v Hannigan [2020] NSWCA 82; (2020) 379 ALR 196
Jackamarra (an Infant) v Krakouer (1998) 195 CLR 516; [1998] HCA 27
Jane Doe v Fairfax Media Publications Pty Limited [2018] NSWSC 1996
Josephson v Walker (1914) 18 CLR 691; [1914] HCA 68
Karpik v Carnival plc [2023] HCA 39; (2023) 98 ALJR 45
King v Goussetis (1986) 5 NSWLR 89
Kinzett v McCourt (1999) 46 NSWLR 32; [1999] NSWCA 7
Lepcanfin Pty Ltd v Lepfin Pty Ltd (2020) 102 NSWLR 627; [2020] NSWCA 155
Longreach Family Living (Vic) Pty Ltd v Simonds Homes Melbourne Pty Ltd [2013] VSCA 274
Martin v Western District of Australasian Coal and Shale Employees' Federation Workers' Industrial Union of Australia (Mining Department) (1934) 34 SR (NSW) 593
Nyunt v First Property Holdings Pte Ltd [2022] NSWCA 249; (2022) 408 ALR 277
Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197; [1988] HCA 32
O'Connor v S P Bray Ltd (1937) 56 CLR 464; [1937] HCA 18
Onus v Alcoa of Australia Ltd (1981) 149 CLR 27; [1981] HCA 50
Pask v Owen [1987] 2 Qd R 421
Polar Aviation Pty Ltd v Civil Aviation Safety Authority (No 4) (2011) 203 FCR 293; [2011] FCA 1126
Porter v OAMPS Ltd [2005] FCA 232; (2005) 215 ALR 327
Preston v Star City Pty Ltd [1999] NSWSC 1273
Qantas Airways Ltd v Rohrlach [2021] NSWCA 48; (2021) 304 IR 218
Re Galtari Pty Ltd (in liq) [2018] NSWSC 917
Shaw v State of New South Wales [2012] NSWCA 102
Sovar v Henry Lane Pty Ltd (1967) 116 CLR 397; [1967] HCA 31
Spencer v Commonwealth of Australia (2010) 241 CLR 118; [2010] HCA 28
Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538; [1990] HCA 55
Wickstead v Browne (1992) 30 NSWLR 1; [1992] NSWCA 272
Willis v Castelein [1993] 3 NZLR 103
Texts Cited: C Sappideen et al, Fleming's The Law of Torts (11th ed, 2024)
M Davies et al, Nygh's Conflict of Laws in Australia (10th ed, 2020)
Category: Procedural rulings
Parties: HNOE Limited (First Applicant)
Manton Music Management Pty Ltd (Second Applicant)
Timothy Manton (Third Applicant)
Angus & Julia Stone Pty Ltd (First Respondent)
Angus John Stone (Second Respondent)
Julia Natasha Stone (Third Respondent)
A&J Touring Pty Ltd (Fourth Respondent)
Angus Stone Pty Ltd (Fifth Respondent)
Julia Stone Pty Ltd (Sixth Respondent)
Representation: Counsel:
Simpsons Solicitors (Applicants)
Matthews Dalton Lawyers (Respondents)
File Number(s): 2024/229521
Publication restriction: N/A
Decision under appeal Court or tribunal: Supreme Court of New South Wales
Jurisdiction: Equity - Commercial List
Citation: [2024] NSWSC 627
Date of Decision: 24 May 2024
Before: Nixon J
File Number(s): 2024/45171
HEADNOTE
[This headnote is not to be read as part of the judgment]
On 14 August 2015, Angus Stone, Julia Stone and "Angus & Julia Stone Pty Ltd" (the Stones) entered into an agreement (the Management Agreement) with HNOE Limited (HNOE). The Management Agreement provided that: HNOE would be the Stones' sole and exclusive manager; that the Stones would make commission payments to HNOE; and that HNOE would ensure that Mr Tim Manton would, at HNOE's expense, provide management services to the Stones. Clause 12.11 of the Management Agreement provided that "[i]t is agreed between us that this agreement shall be subject to English Law and the High Court of Justice, Strand, London shall be the sole court of competent jurisdiction".
Earlier, on 4 October 2013, HNOE and Manton Music Management Pty Ltd (MMM) entered into an agreement (the MMM Agreement) whereby MMM undertook for Mr Manton (MMM's sole director) to provide management services to the Stones in return for 50% of commission payments received by HNOE from the Stones. Neither Mr Manton nor MMM were parties to the Management Agreement.
By Commercial List Statement (CLS) dated 31 January 2024, the Stones and three companies controlled by Mr and Ms Stone (the Plaintiffs) commenced proceedings against HNOE, MMM and Mr Manton (the Defendants) seeking compensation for or restitution of previous commission payments said to have been charged in breach of the Management Agreement and in contravention of s 11(1) of the Entertainment Industry Act 2013 (NSW) (EI Act).
By notice of motion, the Defendants applied to summarily dismiss the claims based on breach of the EI Act and for restitution, and permanently to stay the proceedings pursuant to cl 12.11 of the Management Agreement. The primary judge characterised cl 12.11 as an exclusive jurisdiction clause, and this finding was not challenged on appeal.
The primary judge held that there was a debatable question of law in relation to the breach of statutory duty claim and did not consider that there was utility in summarily dismissing it in any event. His Honour held that there were "strong reasons" to refuse to stay proceedings because: (i) the claim involved parties who were not privy to cl 12.11 (including MMM and Mr Manton); and (ii) the statutory duty claims potentially engaged a mandatory law of the forum by virtue of the EI Act, which was not proven by the Defendants to be an available claim if litigated in England: PJ [183].
The Applicants applied for leave to appeal from the primary judge's decision to refuse summarily to dismiss and stay proceedings.
The Court held (Bell CJ, Leeming JA and Payne JA agreeing), granting leave to appeal and allowing the appeal:
1. The fact that argument, even of an extensive kind, may be necessary to demonstrate that the plaintiffs' claim was so clearly untenable that it could not succeed, should not stand in the way of resolving whether the claim should be struck out and summarily dismissed where: (i) no issues of fact were involved; (ii) there could only be one correct answer to the legal issue; and (iii) there was utility in doing so: [51]-[58] (Bell CJ), [118]-[121] (Leeming JA), [124] (Payne JA).
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; [1964] HCA 69; Jackamarra (an Infant) v Krakouer (1998) 195 CLR 516; [1998] HCA 27; Dey v Victorian Railways Commissioners (1949) 78 CLR 62; [1949] HCA 1; Lepcanfin Pty Ltd v Lepfin Pty Ltd (2020) 102 NSWLR 627; [2020] NSWCA 155, applied.
1. The legislature is generally not to be taken to have intended to create a private right of action for breach of statutory duty where the statute establishes a special means for its enforcement: [61]-[68] (Bell CJ), [118] (Leeming JA), [124] (Payne JA).
Martin v Western District of Australasian Coal and Shale Employees' Federation Workers' Industrial Union of Australia (Mining Department) (1934) 34 SR (NSW) 593; O'Connor v S P Bray Ltd (1937) 56 CLR 464; [1937] HCA 18; Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410; [1995] HCA 24; Josephson v Walker (1914) 18 CLR 691; [1914] HCA 68, applied.
Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1; [1999] HCA 59; Preston v Star City Pty Ltd [1999] NSWSC 1273; Porter v OAMPS Ltd [2005] FCA 232; (2005) 215 ALR 327; Sovar v Henry Lane Pty Ltd (1967) 116 CLR 397; [1967] HCA 31; Jane Doe v Fairfax Media Publications Pty Limited [2018] NSWSC 1996; Gardiner v Victoria [1999] 2 VR 461; [1999] VSCA 100; Grand Central Car Park Pty Ltd v Tivoli Freeholders [1969] VR 62; Polar Aviation Pty Ltd v Civil Aviation Safety Authority (No 4) (2011) 203 FCR 293; [2011] FCA 1126, referred to.
1. In the circumstances of the case, the primary judge should have found that the EI Act did not give rise to a free-standing cause of action for breach of statutory duty and there was utility in reaching this decision: [72]-[81], [86]-[87] (Bell CJ), [118] (Leeming JA), [124] (Payne JA).
Wickstead v Browne (1992) 30 NSWLR 1; [1992] NSWCA 272, distinguished.
1. The primary judge erred in finding that it was for the defendants to establish that the plaintiffs' claims would be able to be litigated in England. Rather, plaintiffs resisting a stay of proceedings by reason of an exclusive jurisdiction clause bear the onus of showing that there were strong reasons for not enforcing such claims: [88]-[90] (Bell CJ), [118] (Leeming JA), [124] (Payne JA).
2. Consideration of elliptical exclusive jurisdiction clauses, which are silent as to their subject matter scope: [93]-[96] (Bell CJ), [118] (Leeming JA), [124] (Payne JA).
Inghams Enterprises Pty Limited v Hannigan [2020] NSWCA 82; (2020) 379 ALR 196; Nyunt v First Property Holdings Pte Ltd [2022] NSWCA 249; (2022) 408 ALR 277; Qantas Airways Ltd v Rohrlach [2021] NSWCA 48; (2021) 304 IR 218; FAI General Insurance Co Ltd v Ocean Marine Mutual Protection & Indemnity Association (1997) 41 NSWLR 559, applied.
1. While MMM and Mr Manton were not parties to the exclusive jurisdiction clause, they were not "members of an undifferentiated group of non-parties" the existence of whom provided strong reasons for not giving effect to the exclusive jurisdiction clause: [109]-[112] (Bell CJ), [118] (Leeming JA), [124] (Payne JA).
Global Partners Fund Ltd v Babcock & Brown Ltd (in liq) [2010] NSWCA 196; (2010) 79 ACSR 383; Australian Health & Nutrition Association Ltd v Hive Marketing Group Pty Ltd (2019) 99 NSWLR 419; [2019] NSWCA 61, applied.
1. The Court re-exercised its discretion, and stayed the proceedings, noting that "as between the Stones and HNOE, the disputes are governed by the exclusive jurisdiction clause and prima facie must be heard in accordance with the parties' contractual agreement. That being so, and bearing in mind the very close and interconnected relationship between those disputes and the claims in restitution brought against MMM and Mr Manton, New South Wales would be a clearly inappropriate forum in which to determine such closely related claims": [105]-[116] (Bell CJ), [118] (Leeming JA), [124] (Payne JA).
Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538; [1990] HCA 55; Henry v Henry (1996) 185 CLR 571; [1996] HCA 51; CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345; [1997] HCA 33, applied.
Regulation 4(1) of the Entertainment Industry Regulation 2020 (NSW) provides that:
4 Fees of performer representatives
(1) For the purposes of section 9(1)(a) of the [EI] Act, the following percentages of the total amount payable to a performer in respect of a performance are prescribed -
(a) in the case of a performance involving live theatre or a live musical or variety performance (being an engagement that does not involve film, television or electronic media) - 10% for a period up to 5 weeks and then 5% for a period after 5 weeks,
(b) in all other cases (including an agreement involving film, television or electronic media) - 10%.
This regulation is in substantially identical terms to reg 4 of the Entertainment Industry Regulation 2014 (NSW).
Schedule 1 to the EI Act is a code of conduct, cl 2(8) of which provides:
A performer representative must use the representative's best endeavours to ensure that employees of the representative -
(a) comply with this Act and the regulations, and
(b) this code.
Section 20 of the EI Act provides:
20 Disputes may be resolved by Industrial Relations Commission
(1) If a question, dispute or difficulty arises between a performer and an entertainment industry representative or entertainment industry hirer, the performer, or an industrial organisation acting on behalf of a performer, may apply to the Industrial Relations Commission to have the matter determined by conciliation and, if necessary, arbitration.
(2) The Industrial Relations Commission may conduct such a dispute resolution process in such manner as the Commission considers appropriate.
(3) The Industrial Relations Commission may make such orders in relation to such a question, dispute or difficulty as the Commission considers fair and reasonable in the circumstances.
(4) A person who fails to comply with an order of the Industrial Relations Commission under this section is guilty of an offence.
Maximum penalty - 50 penalty units or imprisonment for 6 months, or both.
An "entertainment industry representative" is defined in s 4 of the EI Act to mean a performer representative or a venue representative.
Sections 21 and 22 of the EI Act empowers the Secretary to accept and enforce undertakings by entertainment industry representatives for suspected contraventions of the Act.
Sections 24 and 25 of the EI Act should also be noted. Section 24 provides that:
24 Secretary may require person to show cause
(1) The Secretary may, if of the opinion that a performer representative or the director of a corporation that carries on the business of a performer representative has engaged in unlawful conduct, serve on the representative or director a show cause notice.
(2) A show cause notice issued by the Secretary is to require the performer representative or director on whom the notice was served to show cause why the representative or director should not, for the reason specified in the notice -
(a) in the case of a performer representative, be prevented from continuing to carry on the business of a performer representative, or
(b) in the case of a person who is a director of a corporation that carries on the business of a performer representative, be prevented from being a director of such a corporation.
(3) The notice must -
(a) be in writing, and
(b) specify the period (being at least 14 days after the notice is served) in which the person may show cause.
(4) The person on whom a notice to show cause has been served under this section may, within the period specified in the notice, make a written submission to the Secretary in relation to the matters to which the notice relates.
(5) The Secretary -
(a) is to consider any submission made within the period specified in the notice, and
(b) may conduct such inquiries, or make such investigations, in relation to the matters to which the notice relates as the Secretary thinks appropriate.
Section 25 provides that:
25 Entertainment industry prohibition orders
(1) The Secretary may, after serving a show cause notice on a person under this Part and taking into consideration any submissions made in relation to the matter, apply to the Supreme Court for an order under this section in respect of the person if the Secretary is of the opinion that -
(a) the person is likely to engage again, or continue to engage, in unlawful conduct, or
(b) if the person is a director of a corporation that carries on the business of a performer representative, the person is likely to knowingly authorise or permit the corporation to engage again, or continue to engage, in unlawful conduct.
(2) The Supreme Court may, on the application of the Secretary, make an order (an entertainment industry prohibition order) prohibiting the person from carrying on the business of a performer representative or being a director of a corporation that carries on the business of a performer representative for an indefinite period or for a period specified in the order and may make such other orders as the Court considers appropriate in relation to -
(a) the carrying on of the business of a performer representative by the person, or
(b) if the person is a director of a corporation that carries on the business of a performer representative, the conduct of a person as a director of such a corporation.
(3) The Supreme Court may also, if the Court is satisfied that a person has sustained loss or damage as a result of the unlawful conduct of the person against whom the order is made, order the person to compensate the other person for the loss or damage.
(4) The Supreme Court may amend or revoke an order made under this section, on the application of the Secretary or of the person who is subject to the order concerned, if the Court is satisfied that there are reasonable grounds for doing so.
Also of relevance to the breach of statutory duty argument is s 43(1)-(2) of the EI Act, which provides:
43 Civil penalty for breaches
(1) An industrial court or the Local Court may order the person to pay a pecuniary penalty not exceeding $10,000 (a civil penalty) if the Court is satisfied that a person has contravened one of the following -
(a) section 6 (2) (b),
(b) section 7 (4),
(c) section 13 (4),
(d) section 16,
(e) section 18,
(f) the code of conduct.
(2) Proceedings for a civil penalty may be instituted by any of the following -
(a) an authorised officer or any other person authorised by or under this Act or the regulations to institute proceedings for offences,
(b) if the contravention is alleged to have been committed by a performer representative, a performer who, at the time of the alleged contravention, was a party to an entertainment industry agreement with the representative.
(3) Proceedings for a civil penalty may only be instituted within 6 years after the contravention.
(4) To avoid doubt, the rules of evidence apply to proceedings for a civil penalty.
(5) Evidence given in proceedings for the recovery of money is not admissible in proceedings for a civil penalty.
(6) In any proceedings for a civil penalty, the court may award costs to either party and assess the amount of those costs. Costs cannot be awarded against the prosecutor except in the circumstances in which costs can be awarded against the prosecutor in criminal proceedings.
(7) If the court orders a person to pay a pecuniary penalty, the penalty is payable to the State.
(8) The provisions of any Act relating to the recovery of penalties imposed for an offence apply to the recovery of a pecuniary penalty imposed under a civil penalty order.
(9) If, at the time of making a civil penalty order in respect of a contravention of section 6 (2) (b), 7 (4), 16 or 18, the Court is satisfied that the amount required to be paid under the section concerned remains outstanding, the Court may make such orders with respect to the payment of the outstanding amount as the Court considers appropriate.
Section 39 of the EI Act should also be noted. It provides that:
39 Contracting out void
The provisions of this Act and the regulations have effect despite any stipulation to the contrary and no contract or agreement made or entered into before or after the commencement of this section operates to annul, vary or exclude any of the provisions of this Act or the regulations.
The Particulars to these amended paragraphs was in the same form as the Particulars to [29] of the original CLS reproduced at [37] above. Schedule C was in identical form in each case, headed "HNOE Excess Commission Charges" and claimed the same amount. Importantly, the Particulars and Schedule C referred only to "commissions charged by HNOE". No reference was made in these particulars or anywhere else in either the Draft ACLS or the Filed ACLS to any commissions having been paid under the Manton Julia Agreement. Of particular note, the Filed ACLS made no attempt to identify "the amounts demanded or paid under the [Manton Julia] agreement and the dates on which those demands and payments were made", contrary to the direction of the primary judge: see [18] above.
the pleadings must be "so bad that no legitimate amendment could cure the defect": Brimson v Rocla Concrete Pipes Ltd (1982) 2 NSWLR 937 at 942. If a defect can be cured by amendment, the Court should grant leave to amend, rather than strikeout the claim (PJ [32]): Re Galtari Pty Ltd (in liq) [2018] NSWSC 917 at [75].
As already noted at [21] above, the primary judge accepted that whether or not an action for breach of statutory duty was available involved the interpretation of the EI Act, was not a question that would be influenced by any factual finding and admitted of only one correct answer: PJ [154].
The primary judge summarised the competing contentions of the parties. His Honour noted the Applicants' contention that "there is a clear legislative intent not to grant such a right … apparent from the rights which are (and which are not) created by the EI Act" (at [147]), "that one sees in the EI Act is a deliberate legislative attempt to confer very limited and specific rights of enforcement upon a performer and that this legislative intention negates any other, more general, rights being conferred on performers by the EI Act by implication"(at [151]) and noted the following two authorities to which it will be necessary to return: Sovar v Henry Lane Pty Ltd (1967) 116 CLR 397 at 405; [1967] HCA 31 (Sovar); Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410 at 424; [1995] HCA 24 (Byrne).
His Honour's summary of the Plaintiffs/Respondents' position was as follows:
"[152] In response, the Plaintiffs relied on the statement by Brennan CJ, Dawson and Toohey JJ in Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410 at 424; [1995] HCA 24, that a cause of action for breach of statutory duty "arises where a statute which imposes an obligation for the protection or benefit of a particular class of persons is, upon its proper construction, intended to provide a ground of civil liability when the breach of the obligation causes injury or damage of a kind against which the statute was designed to afford protection". In respect of that statement, their Honours cited Sovar v Henry Lane Pty Ltd [1967] HCA 31; (1967) 116 CLR 397 at 405; [1967] HCA 31. Kitto J there observed that, in determining whether a private right of action for breach of statutory duty exists, the endeavour of the courts is to determine what inference really arises, on a balance of considerations, from the nature, scope and terms of the statute, including the nature of the evil against which it is directed, the nature of the conduct prescribed and the whole range of circumstances relevant upon a question of statutory interpretation.
[153] Relying on these principles, the Plaintiffs submitted that the EI Act imposes an obligation on performer representatives for the protection or benefit of a particular class of persons, namely, performers in the New South Wales entertainment industry; and that it should be inferred from the nature, scope and terms of the statute (including the nature of the conduct to which section 11 is directed, namely, the excessive charging of commission) that it was intended to provide a ground of civil liability if breach of that obligation causes damage of the kind against which the statute was designed to afford protection."
The core of his Honour's reasoning was set out in the following paragraphs:
"[154] The Defendants submitted, and I accept, that since the question whether a claim for breach of statutory duty is available depends on the interpretation of the statute, it will not be affected by any evidence that may be led at trial, and that the Court therefore presently has all of the information it requires to determine this issue. Further, since each question of law has only one correct answer (Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541; [2018] HCA 30), it follows that the assertion that a claim for breach of statutory duty is available in respect of a contravention of the EI Act is, as a matter of law, either right or wrong.
[155] However, the Defendants have not brought an application for, and I am not determining, a separate question on this issue. Instead, the Defendants have brought a summary dismissal application. As Dixon J observed in Dey v Victorian Railway Commissioners (at 91) regarding the application of a materially similar rule providing for summary dismissal:
'It is obvious from the decisions that that rule is intended to apply only to cases which are really not arguable. It was never intended that the rule should be applied in cases where under the older practice demurrer would have been the proper course.'
[156] The power conferred by the rule is available where the Court is able to reach 'a definite and certain conclusion' that 'the lack of a cause of action ... is clearly demonstrated': General Steel Industries at 129. It 'is not to be used in cases of doubt or difficulty or where the pleading raises a debatable question of law': Dey v Victorian Railway Commissioners at 91.
[157] Having regard to the competing contentions advanced on this issue, I consider that there is a debatable question of law regarding the availability of a private claim for breach of section 11 of the EI Act.
[158] Further, there would be 'marginal utility' in determining, on this application, whether or not such a claim for damages for breach of statutory duty is available in the circumstances pleaded in the CLS or Draft CLS, unless the alternative claim for restitution, arising from the same pleaded facts, was itself liable to be summarily dismissed: see Wickstead v Browne at 5 per Kirby P." (emphasis added)
The question raised as to the availability of an action for breach of statutory duty in the current case did not involve any issues of fact or of mixed fact and law, nor did it depend on "propositions of law apparently precluded by existing authority" nor was it submitted that acceptance of the Applicants' attack on the claim for breach of statutory duty would stultify the development of the law: Spencer at [25].
Moreover, although the primary judge referred to the parties' competing contentions as giving rise to a debatable question of law, the Stones' position as set out in PJ [152]-[153] and reproduced at [48] above, comprised two paragraphs referring to two relevant High Court decisions and then recorded a submission that was essentially conclusory.
In my respectful opinion, in the unusual circumstances of this case where no issues of fact were involved and it was common ground that there was only one answer to the question of statutory construction, that question was capable of resolution on a summary basis, and, as I shall seek to show, there was real utility in answering it. The fact that argument, even of an extensive kind, may be necessary to demonstrate that the case of the Plaintiffs for breach of statutory duty was so clearly untenable that it could not succeed, should not stand in the way of its resolution, consistent with Sir Garfield Barwick's observations in General Steel to which attention has been drawn. It might also be ventured that, in the unusual circumstances of this case where there was only one correct answer the identification of which was a pure question of law, s 56 of the Civil Procedure Act also favours such a course. Considerations of the kind which inform that section were made explicit by Gummow and Hayne JJ in Jackamarra.
Consistent with the above approach, in Preston at [93], Wood CJ at CL upheld an appeal from the Master and struck out on a summary basis claims for breach of statutory duty on the basis that those claims were untenable. True it is that the engagement of the summary jurisdiction is one to be exercised with caution but that is not to deny its existence in an appropriate case. Contrary to the primary judge's intimation, the fact that no separate question was pursued (even if the discretion to order a separate question had been exercised) was not a reason why the summary jurisdiction was not available and should not have been exercised.
The fact that the Respondents may have fallen within a class of persons to whom the EI Act or aspects of it was directed does not compel an affirmative answer to the existence of an action for breach of statutory duty: Preston at [81], citing Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 67-68; [1981] HCA 50; Jane Doe at [126], citing King v Goussetis (1986) 5 NSWLR 89.
In Byrne, a case involving whether an action for breach of statutory duty arose from breach of an enforceable industrial award, McHugh and Gummow JJ held at 461 that "[t]he existence of rights conferred by the legislation to recover payments due under awards and the power of the court to order payment of penalties tend against the proposition that, from the nature, scope and terms of the legislation, there arises the further inference that damages are recoverable."
Perhaps the clearest guidance as to whether a private action for breach of statutory duty was intended by the legislature is the analysis of Jordan CJ in Martin v Western District of Australasian Coal and Shale Employees' Federation Workers' Industrial Union of Australia (Mining Department) (1934) 34 SR (NSW) 593 at 596 (Martin), a decision cited with approval by Dixon J in O'Connor. The Chief Justice identified as the "most important" matter pointing against the existence of such an intention as "the provision by the statute which creates the new duty of a special means for its enforcement" noting that "[w]here a special means is so provided, the general rule is that the performance of the duty cannot be enforced in any other manner: Pasmore v Oswaldtwistle Urban District Council ([1898] AC 387, at p. 394); and prima facie there is no other remedy". Pasmore was cited with approval by McHugh and Gummow JJ in Bailey v New South Wales Medical Defence Union Ltd (1995) 184 CLR 399 at 446; [1995] HCA 28.
While this rule was said to be not invariable, the earlier decision of the High Court in Josephson v Walker (1914) 18 CLR 691 at 698; [1914] HCA 68 (Josephson) is strongly supportive of it. In that case, it was held that a common law action to recover as damages the difference between wages due under an industrial award and those agreed to was not available by reason of the availability under the Industrial Arbitration Act 1912 (NSW) (Industrial Arbitration Act) of a scheme for resolution of disputes in the form of a special tribunal. Similar reasoning was applied by Jordan CJ in Martin to refuse a right of action at common law for a breach of the provisions of s 521 of the Industrial Arbitration Act.
Examples may be multiplied as to where no action for breach of statutory duty has been held to lie where the statute itself supplies a remedial mechanism beyond the mere existence of a criminal penalty. The simple reasoning is that, where the legislature turned its mind to one or more statutory remedies, its intention impliedly to create a new and additional common law duty was strongly to be doubted. See, for example, Preston at [80]-[93] and especially [87]; Jane Doe at [139]; Gardiner v Victoria [1999] 2 VR 461; [1999] VSCA 100; Grand Central Car Park Pty Ltd v Tivoli Freeholders [1969] VR 62; Polar Aviation Pty Ltd v Civil Aviation Safety Authority (No 4) (2011) 203 FCR 293; [2011] FCA 1126 at [81].
The imposition of a criminal sanction in the form of a fine or penalty does not, in itself, imply the existence or availability of an action at common law and various decisions have referred to the common law presumption that a remedy specified in a statute is intended to be exclusive: see, for example, Kinzett v McCourt (1999) 46 NSWLR 32; [1999] NSWCA 7 at [54]; see also Preston at [82]; Field at [49].
It may be inferred that the legislature intended that such a fine or penalty together with the other range of remedies provided by the EI Act would be a strong inducement against a party conducting itself in the proscribed manner, and that the public policy underpinning the EI Act would be thereby given effect.
In the present case, the level of the penalty for breach of s 11(1) of the EI Act has been left to prescription by the regulations under s 9 of the EI Act and, interestingly, is broadly equivalent to the civil penalties which may be imposed under s 43 of the Act. It was not established that the penalty was inadequate, especially as it would presumably apply to each performance upon which commission was chargeable. In any event, that a penalty may be relatively low in quantum has been said to be incongruent with the availability of common law damages at large: Jane Doe at [112]-[113].
Section 43(5) is not confined or directed to actions under the EI Act at all. Rather, it gives clear guidance in relation to an evidentiary question which might arise in a civil penalty case. It is in essentially the same form as used in other Acts, a fact that militates against it pointing to the creation of a common law action for breach of s 11(1) of the EI Act: see, for example, Industrial Relations Act 1996 (NSW) s 357(5); Industrial Relations (Child Employment) Act 2006 (NSW) s 15(5). Moreover, it speaks of an action for "the recovery of money". Such actions go well beyond actions in tort for compensation and could include actions in contract, debt and restitution. The breadth of the section proves rather too much for Mr Philips' purposes.
For the above reasons, it is clear, in my view, that no action for breach of statutory duty lies against any of the Applicants. To adopt the submission of the Applicants:
"In the teeth of the EI Act's detailed and express provision for various channels short of a private right of action by which aggrieved performers may seek to vindicate rights under the Act, it is unthinkable that the legislature intended, without saying so, that there also be a private cause of action for conduct in contravention of s 11."
Thus, contrary to the conclusion of the primary judge, I am satisfied that the Defendants have established that the claims for breach of statutory duty based on the alleged contravention of the EI Act are not tenable and doomed to fail.
In light of this conclusion and although there was much apparent force to it, it is not necessary to deal with the separate arguments raised in appeal grounds 2(b) or 2(c) by Mr Manton and MMM to the effect that no action could lie against them in any event because they were not a party to any entertainment industry agreement with the Stones, and thus could neither have demanded nor received commission under an entertainment industry agreement. Indeed, neither MMM nor Mr Manton was a party to any agreement with the Stones, had no contractual entitlement vis-à-vis the Stones to be paid commission and are not alleged in any iteration of the original CLS, Draft ACLS or the Filed ACLS to have charged commissions to the Stones under any agreement or at all, although there was evidence before the primary judge that HNOE directed the Stones to transmit some of the commissions they owed HNOE directly to MMM and Mr Manton, presumably to discharge HNOE's obligations to MMM under the MMM Agreement.
In [24] of the Draft ACLS and the Filed ACLS, the Stones pleaded that the Management Agreement and the MMM Agreement together comprised one interconnected or related agreement which, at least considered as a whole, amounted to an entertainment industry agreement, within the meaning of the EI Act. This ambitious argument had been floated before the primary judge in the course of argument. His Honour held at PJ [87] that:
"The question of the proper interpretation of the definition of 'entertainment industry agreement' and in particular whether it is capable of applying to an arrangement consisting of two interrelated contracts is a debatable question of law, which should be considered and determined in the light of the particular factual circumstances of this matter."
As has been said, although challenged on appeal, this is not an argument which is necessary to be dealt with for present purposes in light of my conclusion as to the unavailability of any claim for breach of statutory duty.
It is also unnecessary in light of that conclusion to decide appeal ground 2(d), which concerned the extra-territorial application of the EI Act, and arguments to the effect that s 11(1) of the EI Act did not extend to HNOE. The primary judge considered that there was a "debatable question of law as to whether the Act is capable of applying to an entertainment industry agreement with a foreign choice of law clause": PJ [108]. This argument turned in part on factual questions or mixed questions of fact and law including where demands by HNOE for commission were received. These were not appropriate for determination on a summary basis and, as has been said, were unnecessary to determine given the unavailability of an action for breach of statutory duty.
One of the reasons the primary judge did not embark upon a consideration of the existence or otherwise of an action for breach of statutory duty was his view, by reference to Wickstead v Browne (1992) 30 NSWLR 1; [1992] NSWCA 272 (Wickstead), that there was marginal utility in doing so because the proceedings would continue in any event because of the separate restitution claim propounded by the Stones: see [49] above.
With great respect to his Honour, I disagree. Had the case been bound to proceed in New South Wales in any event, there would have been considerable justification, consistent with Wickstead, for his Honour's reluctance to engage with the question of statutory interpretation presented by the pleaded claims of breach of statutory duty. But, by reason of the exclusive jurisdiction clause in the Management Agreement, there was a live question as to whether the proceedings should continue in New South Wales or be stayed so that they may proceed in the contractually stipulated forum.
The EI Act claim, both in its original form and then in its recalibrated forms cast as a breach of statutory duty, was evidently being used as something of a jurisdictional "hook" or "anchor" to supply a "strong countervailing reason" why the proceedings should remain in New South Wales notwithstanding the existence of the exclusive jurisdiction clause: see, for example, M Davies et al, Nygh's Conflict of Laws in Australia (10th ed, 2020) at [8.57]-[8.60]; Global Partners at [89]. So much emerges from PJ [180]-[183] where the primary judge said:
"[180] In the present case, the Plaintiffs seek to take advantage of the EI Act, which is said to be a mandatory law of the forum (particularly having regard to section 39 of that Act); and a number of parties to the proceeding - namely, the Fourth to Sixth Plaintiffs and the Second to Third Defendants - are not parties to the exclusive jurisdiction clause.
[181] These two matters are interrelated. That is because the only claims advanced against the Second to Third Defendants are the claims for breach of statutory duty and for restitution which are made in respect of the alleged breach of section 11 of the EI Act.
[182] The Defendants did not lead any evidence, or make any submission, to the effect that the High Court of Justice in London would apply the EI Act as part of the lex causae. They acknowledged that "being frank, we haven't sought to prove that if there are claims against the second and third defendant that your Honour thought was arguable that the English court could [deal with] that."
[183] For the reasons given above, I have rejected the Defendants' application for the summary dismissal of the claims against them for breach of statutory duty and restitution, which are based on the alleged contravention of section 11 of the EI Act. Given that is so, and the lack of any evidence or submission that any such claim would be able to be pursued in the High Court of Justice in London, I am satisfied, having regard to those claims, that there are strong reasons for refusing to grant a permanent stay of this proceeding." (emphasis added)
Insofar as the primary judge made reference to the Defendants not leading any evidence, or making any submission to the effect that the claims of breach of statutory duty and restitution based on alleged contravention of the EI Act in PJ [182]-[183] would be able to be pursued in the High Court of Justice in London, his Honour in my respectful opinion fell into error. This was not a matter for the Defendants to establish; rather, insofar as the authorities require "strong reasons" not to give effect to or enforce an exclusive jurisdiction clause and for a stay to be refused in circumstances where, prima facie, parties should be held to their bargain, this was for the Stones to establish. Thus, if they had established that their claims could not or would not have been entertained or been able to be pursued in England, that may well have established strong reasons not to enforce the exclusive jurisdiction clause. No such evidence was, however led.
This error was undoubtedly material to the exercise of the primary judge's discretion to refuse to grant a stay of proceedings as the italicised passage in PJ [183] makes clear.
The elliptical jurisdiction clause in the present case bears some similarity to two jurisdiction clauses which were considered by Giles CJ Comm Div in FAI General Insurance Co Ltd v Ocean Marine Mutual Protection & Indemnity Association (1997) 41 NSWLR 559 at 568:
"For the 1993 contracts and the 1994 contracts the endorsements provided that any disputes will be subject to the exclusive jurisdiction of the English courts, and for the 1995/1996 contracts the slips provided that the reinsurance "is subject to English jurisdiction". The language is concise, but is in the most ample terms: in the endorsements, "any disputes" naturally encompasses disputes of any kind in connection with the reinsurance, and the slips are no less comprehensive. It is all but inconceivable that an insurer and a reinsurer would not have contemplated as possible disputes, or possible occasions for subjecting the reinsurance to the jurisdiction of a court, a claim by the reinsurer to have avoided the contracts of insurance for non-disclosure or breach of duty in their formation, or intended that such a claim should not fall within their agreed jurisdiction provisions."
Thus, his Honour held that non-contractual claims to rescind the policies and to set them aside for non-disclosure nonetheless fell within the scope of the jurisdiction clause. (An earlier decision had held that the clauses conferred exclusive jurisdiction on the English courts: FAI General Insurance Co Ltd v Ocean Marine Mutual Protection and Indemnity Association (1997) 41 NSWLR 117.)
The claims by the Stones for restitution against HNOE fell within the scope of the exclusive jurisdiction clause. There must be attributed to the parties a contractual intention to submit any disputes arising out of the relationship established by the Management Agreement to litigation in London. No commercial purpose would be served by stipulating that the High Court of Justice was to be "the sole court of competent jurisdiction" had the parties not intended that all disputes arising out of or relating to the Management Agreement would be subject to that clause. Any claim for restitution as a result of mistakenly overpaid commission under the Management Agreement plainly fell within that clause and no persuasive argument was advanced against such a conclusion.
It follows that the entirety of the claims against HNOE, namely, claims under and for breach of the Management Agreement and for restitution in relation to allegedly mistaken payments fell within the scope of the exclusive jurisdiction agreement and prima facie should be stayed.
What, then, of the restitution claims made against MMM and Mr Manton? It was far from evident in the original CLS whether, to the extent that restitution was sought from the Defendants, a free standing cause of action in restitution was being pursued as opposed to the Stones simply using the word "restitution" in the sense of seeking repayment of what were said to have been overpayments of commission by reason of the Stones' ignorance of s 11(1) of the EI Act (on the assumption that it applied to the parties). The primary judge regarded the pleading of the restitution claim to be unsatisfactory. His Honour noted at PJ [159] that the Stones sought an order that the Defendants "provide restitution to the Plaintiffs with respect to [their] breaches of the ... EI Act". At PJ [163], his Honour accepted that "neither the existing CLS nor the Draft ACLS identifies the vitiating factor upon which the Plaintiffs rely to establish an entitlement to restitution."
At PJ [165]-[166], the primary judge observed:
"[165] In the present case, the CLS and Draft ACLS plead the following material facts:
(1) the contractual arrangements in place between the Plaintiffs and the Defendants which are said to constitute an entertainment industry agreement;
(2) the statutory prohibition under the EI Act on demands for and receipts of fees or other remuneration under an entertainment industry agreement above a capped amount;
(3) the making of demands by the Defendants in contravention of that prohibition; and
(4) the receipt of payments from the Plaintiffs in excess of the capped amount prescribed by the Act.
[166] Those material facts, pleaded in support of a claim in restitution, would permit the leading of evidence, including as to the Plaintiffs' state of mind at the time those payments were made, which might be capable of establishing a qualifying or vitiating factor, such as a mistake of law, sufficient to found a claim in restitution (see the recent discussion regarding restitution on the basis of a mistake of law in Redland City Council v Kozik [2024] HCA 7). On the current application, I am not satisfied, to the requisite high degree of certainty, that no such claim is available."
In the Filed ACLS, the restitution claim against MMM and Mr Manton was repleaded as follows:
"28B. During the period between October 2013 and June 2023, MMM and Manton demanded from HNOE pursuant to the MMM Agreement, and received from the Plaintiffs and HNOE, approximately 50% of the commission which was demanded by HNOE from the Plaintiffs as commission payable pursuant to the HNOE Management Agreement (MMM Manton Commission),
Particulars
Schedule A hereto contains a list of the dates, invoice details and amounts of each payment of HNOE Commission Invoices and MMM Commission Invoices paid by the Plaintiffs.
Invoices sent by MMM to HNOE and the Plaintiffs with respect to TaP Commission split payable for exclusive management consultancy provided by MMM and Manton to HNOE pursuant to the MMM Agreement including, for example, MMM Invoices numbered/dated 16.11.16; 14.8.18; 19.3.18; 09.11.18; 4.3.19; 15.7.19; 06.08.19; 85-10.12.20; 0140; 0056; 104 12.03.21; 0126; 183 27.6.22; and 0205.
Schedules headed "Account Transactions" for the period 1 January 2013 to 31 December 2023 with respect to each of the First, Fourth, Fifth and Sixth Plaintiffs prepared by Gild.
28C. In the premises pleaded above, the MMM Manton Commission was commission payable and paid by the Plaintiffs and HNOE to MMM and Manton pursuant to an entertainment industry agreement for the purposes of the EI Act.
28D. At the time the demands and payments referred to in paragraphs 28A-C above were made, the Plaintiffs were unaware:
(a) of the EI Act and the EI Regulations, and in particular that the amount which a performer representative providing services under an entertainment industry agreement could charge for remuneration was capped at 10% of the amount payable to a performer pursuant to the EI Act and the EI Regulations; or
(b) that the Defendants were prohibited by s 11 of the EI Act from demanding or receiving a fee or remuneration that exceeded the Capped Amount of 10%.
28E. If the Plaintiffs had been aware of the matters pleaded in paragraph 28D, they would not have made any payments to the Defendants which were in excess of the Capped Amount of 10%.
28F. In the premises pleaded above, the payments made by the Plaintiffs, and received by the Defendants, in excess of the Capped Amount of 10% were made pursuant to a mistake of law, and, or in the alternative, contrary to public policy."
This form of the pleading was not before the primary judge and thus its existence did not inform the exercise of his Honour's discretion although it may fairly be said that his Honour contemplated that such a claim may be available: see PJ [166] reproduced at [100] above. For reasons explained at [19]-[20] above, the Filed ACLS was before this Court on the hearing of the appeal and it is relevant to take it into account in the re-exercise of the discretion in light of my conclusions as to the unavailability of the claims for breach of statutory duty.
The Defendants attacked the fresh claim for restitution in the Filed ACLS on the following bases:
"30. A claimant who pleads mistake of law as the unjust factor giving rise to a prima facie entitlement to restitution must prove (and hence plead) that the mistake was "causative of the payment": David Securities Pty Ltd v Commonwealth Bank of Australia (1992) 175 CLR 353 at 378. A mistake will not be causative where the payee "is not concerned to query whether payment is legally required": David Securities at 373-74. Relief will not lie where the payer "has no belief one way or the other on the matter": Mason & Carter's Restitution Law in Australia, 4th ed (2021) at [415].
31. Even assuming, contrary to the applicants' position, that the respondents may on the present application have the ACLS taken into account as their best attempt to plead a claim in restitution which could have defeated the summary dismissal or strike out application, it remains defective for reasons that further illustrate that the available material facts do not support the cause of action. ACLS [28E] asserts that the respondents would not have made payments in excess of the statutory cap "[i]f [they] had been aware of" the EI Act and regulations. That is insufficient to plead causative mistake of law where the respondents fail to plead that they "turned [their] mind to the question of [their] legal obligation" at the time of payment (Mason and Carter at [415]) and where Mr and Ms Stone have given evidence to the contrary."
It is neither necessary nor desirable, in my view, to consider the strength of this objection to the claim in restitution. Unlike consideration of the claim for breach of statutory duty, the availability of any restitutionary claim as against MMM and Mr Manton is not divorced from factual inquiry, making it inapposite for summary dismissal. That is not the end of the matter, however. I deal with its continuing significance at [109]-[113] below.
This leads to the question whether the existence of the restitutionary claim against MMM and Mr Manton as set out at [101] above itself supplies a strong reason for refusing a stay of proceedings and thus deprives HNOE of the benefit of its bargained for exclusive jurisdiction clause. In my view it does not, and to allow it to have that effect would be a case of the tail being allowed to wag the jurisdictional dog. The present case, in this regard, is closely analogous to Global Partners. In that case, the plaintiff had sued Babcock & Brown Ltd (in liq) (Babcock) and a number of related companies. Global Partners and Babcock were parties to an English exclusive jurisdiction and choice of law agreement. The related Babcock parties were not party to that agreement but this did not prevent this Court from upholding a decision to stay the entirety of the proceedings. Under the heading "Party scope", Spigelman CJ made the following observations:
"[71] With respect to the proposition that cl 18.11 does not respond to claims made against non parties to the agreement, there are judgments which have interpreted an exclusive jurisdiction clause to bind a party with respect to proceedings against a non-party. (See Donohue v Armco Inc [2001] UKHL 64; [2002] 1 Lloyd's Rep 425 at [60]-[61] per Lord Scott of Foscote (although the issue was not argued in the House of Lords. See at [14] per Lord Bingham).) Lord Scott's approach was applied to the clause construed in Winnetka Trading Corp v Julius Baer International Ltd [2008] EWHC 3146; [2009] 2 All ER 735 at [28]-[29]. On the other hand, other exclusive jurisdiction clauses have been interpreted as applying only to proceedings between the parties. (See, eg, Credit Suisse First Boston (Europe) Ltd v MLC (Bermuda) Ltd [1999] 1 Lloyd's Rep 767 at 777-778; Morgan Stanley & Co International plc v China Haisheng Juice Holdings Co Ltd [2010] 1 Lloyd's L Rep 265 at [21]-[30] noting the observations with respect to Lord Scott's judgment in Donohue supra at [30].)
[72] Each contract must be interpreted in its context. Similar, even identical, words do not necessarily have the same meaning in different contexts.
[73] In the present case, it hardly needs saying that BBL, BBI and BBUS do not have contractual rights with respect to the exclusive jurisdiction clause, because they are not parties to the LPA. BBMGP does have such rights which, in my opinion, it is entitled to assert both with respect to the claims against itself, and with respect to the closely related, indeed, relevantly identical, claims against BBL, BBI and BBUS. The focus of such an assertion is the fact that GPF, which is a party to the contract, has agreed to conduct litigation "arising out of or in connection with" the LPA in England. However, BBL, BBI and BBUS are also entitled to approach the Court, in their own right, to request that the Court exercise its discretion to grant a stay. This is so because of their involvement in the affairs of the Partnership, as envisaged by the LPA itself, and the rights conferred upon them as Indemnified Persons under the LPA.
[74] GPF sought to categorise the first three respondents as "non parties". However, there are non parties and non parties. These respondents are not strangers to the LPA.
[75] I have set out at [29]-[32] above the provisions of the LPA that directly refer to the involvement of the members of the BB Group in the decision making processes of the Partnership. These proceedings concern the internal decision making processes of the BB Group that determined how the funds of the Partnership were to be invested, particularly the decision-making process that led to the Coinmach transaction being completed. The obligation imposed upon GPF by cl 18.11 should be interpreted to extend, at least, to the participants in the decision making processes envisaged by the LPA.
[76] The proceedings in this Court arise, and arise only, from the internal decision making processes for which the LPA provides, namely the making of investments. By reason of the structure of the BB Group, the functions of BBMGP, as the Managing General Partner under the LPA, were subject to the assistance and direction of other members of the Group in the manner alleged in the Commercial List Statement. Indeed, that participation is the very foundation of the causes of action which GPF seeks to agitate in this Court."
At [78], Spigelman CJ went on to hold that "[n]otwithstanding the fact that BBL, BBI and BBUS are not parties to the LPA, they cannot be categorised as members of an undifferentiated group of 'non parties'. It may well be that cl 18.11 will not apply to other non parties. However, the respondents in the present case are in a quite distinct category".
The inclusion of the related companies as the Fourth to Sixth Plaintiffs in the Filed ACLS and the restitution claims sought to be agitated against MMM and Mr Manton in it make the present case closely analogous to Global Partners. MMM and Mr Manton provided their services to the Stones not directly, but through HNOE and under the Management Agreement which contained the exclusive jurisdiction clause. Equally, the involvement of the related companies was as parties which the Stones used to make commission payments to HNOE under the Management Agreement. Neither the related companies nor MMM and Mr Manton can be categorised as "members of an undifferentiated group of non-parties", to quote Spigelman CJ in Global Partners.
In drawing this analogy, it is not necessary to go so far as to say that the related companies and MMM and Mr Manton are "bound" by the exclusive jurisdiction clause. An alternative way of putting the matter is to say that, as between the Stones and HNOE, the disputes are governed by the exclusive jurisdiction clause and prima facie must be heard in accordance with the parties' contractual agreement. That being so, and bearing in mind the very close and interconnected relationship between those disputes and the claims in restitution brought against MMM and Mr Manton, New South Wales would be a clearly inappropriate forum in which to determine such closely related claims: see Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 at 559-560, 564-5; [1990] HCA 55; Henry v Henry (1996) 185 CLR 571 at 591; [1996] HCA 51; CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345 at 399-401; [1997] HCA 33; see also Oceanic at 247-8. A stay of the residual claims against MMM and Mr Manton would be justified by reference to the "controversy as a whole": see also Hive at [88]-[89].
The Plaintiffs' claims against MMM and Mr Manton would be able to be made in England as part of the dispute between the Stones and HNOE, and MMM and Mr Manton must, by reason of their being parties to the application for a stay of proceedings, be taken to have evinced a willingness for the disputes (including those against them - other than the non-tenable claims for breach of statutory duty) to be heard in England. Were those parties not to submit to the jurisdiction of the English courts in any proceedings brought against them, it would be open to the Respondents to seek to lift any stay granted against them.
To the extent that [29] of the Filed ACLS (see [40] above) seeks restitution for payments made under the Manton Julia Agreement, as pointed out at [41] above, no commissions are alleged to have been charged or demanded by Mr Manton or received by him under that Agreement. In the course of argument in this Court, counsel for the Respondents was unable to explain where or how the Manton Julia Agreement had any relevance. Accordingly, I do not take them into account.
In re-exercising the Court's discretion, I have regard to the following matters:
1. the claims for breach of statutory duty are untenable;
2. the claims for restitution against HNOE fall within the scope of the exclusive jurisdiction clause;
3. the claims for breach of the Management Agreement against HNOE fall within the scope of the exclusive jurisdiction clause;
4. the claims for restitution against MMM and Mr Manton are closely related to the claims for restitution against HNOE, especially given the Respondents' contention as to the interrelationship between the Management Agreement and the MMM Agreement;
5. the existence of those claims in all of the circumstances of the case do not supply strong reasons against the grant of a stay of proceedings;
6. the Respondents can bring their claims against all Defendants in one forum, that being the one the Stones contractually bargained for with HNOE in the Management Agreement which was stated to appoint HNOE their exclusive agent;
7. reference in the Filed ACLS to the Manton Julia Agreement does not appear to disclose any cause of action given that no commissions are alleged to have been charged or demanded by Mr Manton or received by him under that Agreement; and
8. the claims by the related companies appear to pertain to payments of commission they made on behalf of the Stones. If free-standing claims at all, they are intimately bound up with the claims made by the Stones which are governed by the Management Agreement and which should be heard in England.
Bearing these matters in mind, the proceedings should be stayed.
Ultimately it is a question of judgment, but where as in the present case the viability of a claim for damages for breach of statutory duty was a pure question of law, it was open and appropriate to resolve it in the course of determining the motion to enforce the exclusive jurisdiction clause. Further, because there were no facts and the arguments relatively brief, there was no occasion for a separate question to be ordered before that could occur.
Finally, I would also adhere to the Chief Justice's observations about the expeditious way in which the primary judge resolved a complicated motion, which altered its form as the hearing progressed.
I agree with the orders proposed by the Chief Justice.
PAYNE JA: I agree with the orders proposed by the Chief Justice and with his Honour's reasons. I also agree with the additional observations of Leeming JA.