National Mutual Holdings Pty Ltd & Ors v Sentry Corporation & Anor, the [1988] FCA 359

Federal Court of Australia|1988-07-01|Before: Jenkinson J

High Court and Federal Judiciary - Tedesral | Practice and pro-sdure - Change cf ven. - af wonvenrence.

Judiciary Act 1503 - 3.44 Pederal Gsurt Order 10 Puls lifts,

Spiliada Maritime Corporation v. Canmsulex Led. 7 Hansen v. Border Morning Mail Pty. Ltda. 11367, 9 N.S.8. Pozniak vw. Smith (1982) 151 C.L.R. 38

Right Home Improvements International Ply. Ltd. v. Tmperial Alarin Screens vAust.) Fey. Ltd. (1354) A.T.P.R. 40-641

TVA Enterprises Ltd. ov. Magna Techtronies 'Aust.) Fty. Etd. \unrep. WAG62 of 1986 Judgment 20 Feb. 1987; noted 1387

A.T.P.R. (Digest) para. 46-022} Church v. Barnett (1871) L.R. 6 C.F. lle

NATIONAL MUTUAL HOLDINGS Pry. LTD., ACC HOLDINGS LIMITED, ACC FINANCIAL MANAGEMENT LIMITED, ACC GENERAL INSURANCE LIMITED AND AUSTRALTAN CASUALTY COMPANY LIMITED v. THE SENTRY CORPORATION AND

"oa N Melbourne Jot Cree eS 26 April, 1588 of 'ene Ve ¢ > lef 7 @ Arn 1938

BETWEEN: NATIONAL MUTUAL HOLDINGS PTY. LTD. ACC HOLDINGS LIMITED ACC FINANCIAL MANAGEMENT LIMITED ACC GENERAL INSURANCE LIMITED and AUSTRALIAN CASUALTY COMPANY LIMITED Applicants AND: THE SENTRY CORPORATION and PEAT MARWICK MITCHELL & CO (A FIRM) Respondents AND BETWEEN: PEAT MARWICK MITCHELL & CO_(A FIRM) Cross-Claimant AND: THE SENTRY CORPORATION

First Cross~~Respondent ANDREW THOMAS GREGORY Second Cross-Respondent WILLIAM CLARKE 0' KANE Third Cross~~-Respondent ACC HOLDINGS LIMITED Fourth Cross-Respondent

CORAM: Jenkinson J. PLACE: Melbourne DATE: 26 April, 1988

The first applicant acquired from the first respondent all the issued shares in the second applicant, which has at all material times owned all the issued shares in the remaining four applicants. The applicants allege that the acquisition by the First applicant was tiunduced by erroneocus statements in the financial records of the other applicants, for which errors the vendor of the shares and the second respondent, a firm of

accountants which audited those records, are responsible. Claims

The principal place of business of the first applicant

is in Melbourne. The principal place of the other applicants' businesses is in Sydney. The first respondent is an American corporation with no current business in this country. The two

natural persons who are crass-respondents live in Sydney. The

respondent firm of accountants moves the Court pursuant to 5.48 of the Federal Court of Australia Act 1977 and Order 30 Rule 6(2) for an order that the trial of the proceeding and of the cross-claim be fixed at Sydney and, pursuant to that section and Order 10 Rule 2(f), that the proceeding and cross-claim he transferred to the New South Wales Registry from the Victorian Registry, where the

The -Erial 15 expected to occupy a number of weeks, and preparation for trial i185 expected to occupy much time and to involve the collaborative activities of many persons. Most of the activities out of which the matters in dispute arose took place in Sydney and were the activities of residents of Sydney. The second respondent's witnesses and legal and accountancy advisers are nearly all residents of Sydney and the relevant records in the that respondent's possession are in Sydney. On the other hand most of the relevant records which are in the possession of the applicants are in Melbourne, many of the witnesses to be called by the applicants reside in Melbourne, and all the many legal and accountancy advisers of the applicant, most of whom have been

engaged in the preparation of the case for more than a year,

Counsel for the respondent firm submitted that wnat had to be shown by his clients was that the proceeding may be tried in Sydney more suitably for the interests of all the parties and the ends of justice. That statement of the criterion was said to accord with the principles to be found in cases concerning stay of

proceedings on the ground of forum non conveniens (discussed in

Spiliada Maritime Corporation v. Cansulex Ltd. C1987] A.C. 460)

and concerning change of venue in New South Wales (such as Hansen vw. Border Morning Mail Pty. Ltd. (1987) 93 N.S.W.L.R. 44) and concerning cho1ce of the Court to which a matter should be remitted by the High Court under 5.44 of the Judiciary Act 195303 (such as Pozniak v. Smith (1982) 151 C.L.R. 38). That statement and those principles were at variance, it was submitted, with the statement of the appropriate criterion, by which to determine applications to this Court for change of the trial venue, adopted

by Pincus J. in Hodder wv. The Australian Workers' Union (1984) 4

F.C.R. 541 and in Right Home Improvements International Pty. Ltd. v. Imperial Alarm Screens (Aust.) Pty. Ltd. (1936) A.T.P.R. para.

40-641, and by French J. ain TVW Enterprises Ltd. 7. Magna

Techtroniecs (Aust.) Pty. Ltd. (unreported; WAG62 of 1986; judgment 20 February 1987; noted (1987) A.T.P.R. (Digest) para. 46-027). Those two learned judges adopted the criterion stated by Bovill

C.d. for the Court sof Common Pleas in Church v7. Barnett (1371)

"The rule is that the venue shall not be changed from the place where the plaintiff has thought fit to lay it, without the special order of a judge : and that order is to be made only where there 1s a manifest preponderance of convenience in trying the cause in the place to which the defendant seeks to remove the venue."

The best justification of a rule of practice may be that

in time it becomes well known. French J. has stated other grounds

"At first blush an unqualified balance of convenience test has the advantage of logic and simplicity in the determination of change of venue applications.

There 15 no obvious reason for giving the applicant's choice of venue special weight.

An arbitrary or capricious choice would count for nothing against the respondent in any event.

In my opinion however considérations expedition and public policy tend in favour a requirement that more than a mera balance convenience in favour of a venue should established in order to justify a change that venue.

In many cases such as the present convenience may be finely balanced.

In the progress of a case ta trial, circumstances may change. A person formerly thought to be a vital witness may no longer be so. A new witness may emerge and with his emergence the balance of convenience may change. Successive changes of venue might Le justified if that test were to he applied.

In my opinion public interest requires that Chere should be demonstrated, as was requirad in Hodder v The Australian Worxers Union (supra), a manifest preponderance of convenience in Favour of the sed change. To put it another way the venue chosen should, when all the circumstances are examined, be

The test does in effect confer upon the applicant's initial choice a certain advantage in the equation. That advantage springs not From any particular sanctity attaching to his choice but rather from the need to fully; justify any transfer."

In my opinion a single judge should follow a rule of Practice laid down by other single judges of the Court, save in exceptional circumstances. For that reason, and because I think

the rule derived from Church v. Barnett, supra promotes expedition

and discourages unprofitable disputation about finely balanced

considerations, the evaluation of which is often very difficult, I will follow the decisions of Pincus J. and French J. The

questions which arise in cases under s.44 of the Judiciary Act

1903 and in cases of applications concerning the fora of foreign States and service om persons outside the territory of the State are not uncommonly quite different from those which may arise under 3.438 of the Federal Court of Australia Act 1977, and I do not think myself constrained by reasoning in cases of the former

On the evidence adduced and the submissions advanced on the hearing of this motion I would be inclined to think, bu& not without doubt, that the proceeding and the cross-claim may be tried in Sydney more suitably for the interests of all the par and the ends of justice than in Melbourne. But I certainly cannot find a manifest preponderance of convenience in trying those causes in Sydney. Accordingly the motion for change of the venue of the trial will be dismissed. There 15 mo advantage in transferring the proceeding or the cross-claim to the New South

Wales Registry if the trial is to be in Melbourne. That motion

I certify that this and the preceding pages are aA true copy the Reasons for Judgment herein 9 the Honourable Mr. Justic

Mr. A.C. Archibald Q.C., Mr. P.R. Hayes and Mr. C.M. Scerri

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Judgment (50 paragraphs)

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