Poulton v The Commonwealth

Federal Court of Australia|1994-11-07|Before: Beaumont J

Assignment - Purported assignment of choses in action being rights of action in tort and analogous statutory claims - whether capable of assignment.

Poulton v The Commonwealth (1953) 89 CLR 540 - cons.

Park v Allied Mortgage Corporation Limited (1993) ATPR 53,467

cons.

REASONS FOR JUDGMENT (No. 2) (Qn_ application to strike out paras. 62 to 67

of the further amended statement of claim) INTRODUCTION

Before the Court is a notice of motion seeking to strike out certain amended paragraphs of the further amended statement of claim on the ground that, so far as the claims made depend upon purported assignments of certain causes of action alleged, they disclose, the present respondents say, no reasonable cause of action in that the assignments alleged were ineffective or otherwise should not be enforced by this

Previous amendments were sought to be made pursuant to leave granted for the reasons given in Reasons for Judgment (No. 1) given on 13 September 1994; however, on 31 October 1994, I ordered that those amendments be struck out in the

light of pleading deficiencies of the kind described in

Reasons (No. 1), rather than on substantive grounds. The present amendments are now attacked on a substantive basis only; that is to say, no mere pleading point is now taken (cf. Practice Note by J.G. Starke Q.C. (1986) 60 ALJ 304). As has been noted, the question is whether, so far as concerns

E_R) V; PLEADIN The introductory allegations in the statement of claim were summarised in Reasons (No. 1) and should, to this

"62. (a) Induced by and in reliance on the truth of the representations various persons ('the Original Debentureholders' ) acquired beneficial interests in debentures on or subsequent to issue in October 1988.

[It is common ground for present purposes that, as alleged in para.8 of the statement of claim,

by an amended registration statement incorporating a prospectus dated 6 October 1988 ("the prospectus") registered with the

Securities and Exchange Commission of the United States ("the SEC") on or about 7 October 1988, Linter Textiles offered to issue US$200,000,000 13.75% senior subordinated debentures due 1 October 2000 ("the debentures") to be delivered and paid for on or about 13 October 1988 at the offices of the Underwriter of the issue, Drexel Burnham Lambert Incorporated ("the Underwriter") in New York. }

(b) If the failure to speak had not occurred none of the Original Debentureholders would have acquired beneficial interests in debentures.

suffered loss or damage by the conduct of the Respondents referred to herein that was done in contravention of Section 52 of the Trade Practices Act and Section 42 of the Fair Trading Act (NSW)

otherwise suffered loss and damage by reason of the matters complained of herein.

The debentures are worthless' as senior indebtedness as defined by the Indenture and the Priority Deed substantially exceeds the value of the assets of Linter Textiles and the subsidiaries, and accordingly the Original Debentureholders lost the price paid for the debentures.

The Original Debentureholders have been deprived of the sums of money respectively paid out by them for the debentures such loss being measured by market interest rates from time to time since the date upon which each of such persons acquired' their debentures, pursuant to the principle in Hungerford v Walker.

were entitled to recover the amount of such loss or damage from the Respondents and were entitled to other relief under Sections 82 and 87 of the Trade Practices Act and under Sections 68 and 72 of the Fair Trading Act (NSW) (all referred to as 'the Trade Practices Entitlements' )

were entitled to the relief sought in these proceedings for breach of contract, negligence, fraud and intentional interference with contractual relations under the general law of New South Wales ('the General Law Entitlements' )

(iii) were entitled to the relief sought in these proceedings under the laws of the State of New York and_ the statutes of the United States of America ('the U.S. Entitlements').

Certain of the Original Debentureholders assigned to the Ariel Entities in various proportions their debentures and all choses in action in relation to the debentures and the acquisition thereof including the Trade Practices Entitlements, the General Law Entitlements and the US Entitlements. The assignments to the Ariel Entities:

(a) were either in writing or through words or conduct;

(b) to the extent that they were in writing were in the form of the documents which

may be inspected at the office of the Applicants' solicitors and were delivered to the Ariel Entities in New York;

(c) to the extent that they were through words or conduct, occurred in accordance with practices of the relevant bond market in New York together with the assignors' failure to assert any rights under or pursuant to the debentures;

(d) were governed by the law of New York and/or US Federal Law.

Particulars of Assignments to Ariel Entities by Original Debentureholders

Assignor Date Face Amount Amount Paid ($US) ($Us) American Capital 17.04.90 4,880,000 115,900.00 Templeton Global ) 24.04.90 5,000,000 ) 148,437.50 Templeton Investment ) 500,000 ) Templeton Global ) 250,000 ) Templeton Income } 500,000 )

Aim Advisors 07.02.91 600,000 8,250.00 Franklin Age 10.07.91 15,000,000 421,875.00 Franklin Universal 10.07.91 7,000,000 196,875.00 Franklin Partners 10.07.91 500,000 14,062.50 Prudential Insurance 08.08.91 7,350,000 229,687.50 Prudential High Yield 08.08.91 6,500,000 203,125.00 Prospect International 08.08.91 3,000,000 82,500.00 American Income 26.12.91 600,000 5,250.00 Industrial Indemnity 16.09.92 3,000,000 75,000.00 Westchester Fire 16.09.92 2,000,000 50,000.00 American Income 06.10.92 1,000,000 20,000.00 Dependable Insurance 23.09.93 1,000,000 20,000.00 Equitable Capital 15.03.94 2,000,000 25,000.00

choses in action in relation to the debentures and the acquisition thereof including the Trade Practices Entitlements, the General Law Entitlements and the US Entitlements. The non- original debentureholders assigned to the Ariel Entities in various proportions their debentures and all choses of action in relation

to the debentures and the acquisition thereof including the Trade Practices Entitlements, the General Law Entitlements and the US Entitlements. The assignments by the non- Original Debentureholders to the Ariel Entities:

(a) were either in writing or through words or conduct;

(b) to the extent that they were in writing were in the form of the documents which may be inspected at the office of the Applicants' solicitors and were delivered to the Ariel Entities in New York;

(d) were governed by the law of New York and/or US Federal Law.

Particulars of Assignments to Ariel Entities by non-Original Debentureholders

Predecessor Assignor Date Face Amount In Title Amount Paid ($US) ($US)

N/K Grandchester & Co. 22.06.90 500,000 4,698.50 N/K Oppenheimer & Co. 06.03.91 5,000,000 62.500.50 N/K New England Asset 08.03.91 5,000,000 87,500.00 N/K Colonial Management 14.05.91 1,000,000 15,000.00 N/K Prudential High Yield 08.08.91 4,000,000 125,000.00 N/K US High Yield 08.08.91 1,000,000 31,250.00 N/K Prudential High Yield 08.08.91 700,000 21,875.00 N/K Nomura Target 17.09.91 1,000,000 32,500.00 N/K Columbia Universal 23.06.92 300,000 6,750.00 N/K Hill Country 23.06.92 200,000 4,500.00

N/K RTC 02.10.92 15,000,000 93,750.00 N/K American Income 06.10.92 1,400,000 3,500.00 N/K Andrew Lester 15.10.92 300,000 1,500.00 Sec Pac Bankers Life 07.05.93 843,000 1,686.00 Note: N/K indicates not known at this stage.

The Ariel Entities are not presently able to give any better particulars of the assignments by the Original Debentureholders to the non-Original Debentureholders.

Ariel Entity Proportion (%) Mt Tavor Partners 7.4 AFL 52.9 CFL 6.8 CP 1.7 IP 3.4 GC 27.8

An Original Debentureholder assigned to DHS [Mr. Schieber, the seventeenth applicant] its debentures and all choses in action in relation to the debentures and the acquisition thereof including the frade Practices Entitlements, the General Law Entitlements and the U.S. Entitlements. The assignment was:

(b) in the form of the document which may be inspected at the office of the Applicants' solicitors

(g) governed by the law of California, New York and/or US Federal Law.

Particulars Assignor Date Face Amount Amount Paid (sus) ($US) Anchor Life 27.8.93 1,000,000 5,000

(a) Notice in writing of the assignments set out and referred to in paragraph 63, 64 and 65 above has been given in accordance with section 12 of the Conveyancing Act 1919;

(b) The debentures are property rights or interests and the Trade Practices Entitlements, the General Law Entitlements and the U.S. Entitlements are ancillary to such property rights and interests;

(c) The assignments were effective under the law of New South Wales to vest in the Ariel Entities and DHS the right to bring this proceeding in their own names to enforce the frade Practices Entitlements, the General Law Entitlements and the U.S. Entitlements.

(a) Under the general law of New York and/or under Article 13-101 New York General Obligations Law (GOL) causes of action in tort and breach of contract are assignable:

American Hemisphere Marine Agencies Vv Kreis 40 Misc 2d 1090, 244

(b) The said assignments do not fall within any of the cases which are exceptions to the GOL:

American Hemisphere Marine Agencies v Kreis 40 Misc 2d 1090, 244

Hill v atra orporation 65A.D.2d 737,410 N.Y.S 2d 614 (1st Dep't 1978)

Scarfe v Lorom 141 N.Y.S.2d 196 (Sup. Ct. Onondaga Co. 1955)

Frisch v Zelart Drug Co. Inc. 180 Misc. 733, 734 46 N.Y.S.2d 44, 45 (City Ct. N.Y.

Capobianco v Halebass Realty Inc. 72 A.D.2d 804, 421 N.Y.S.2d 924, 925 (2d

M.W. Zack Metal Co v Int'l Navigation Corp of Monrovia 112 A.D.2d 865, 967, 493,

(c) Under US Federal Law and/or the law of New York and/or the law of California an assignment of securities laws claims in conjunction with an assignment of debentures is wholly enforceable:

Gardener v Surnamer 608 F Supp 1385, (d) The said assignments were effective under US Federal law and/or the law of New York and/or the law of California to vest in the Ariel Entities and DHS the right to bring this proceeding in their own names to enforce the Trade Practices Entitlements, the General Law Entitlements and the U.S. Entitlements.

(e) Under the law of New South Wales the effect referred to in paragraph (d) will be recognised."

T VIDENCE ON THE MOTION The evidence in the motion may, relevantly, be

(1) (a) That public announcements were made in the period between January and April 1990 to the effect that Linter Textiles was experiencing liquidity problems; that receivers of the assets of Linter Group and

that in March 1991, proceedings were commenced in New York against the Linter companies and their officers; and that in April and August 1991, liquidators were appointed to the Linter Group and

That assignees commenced to purchase debentures from 17 April 1990; that between 17 April 1990 and 22 June 1990, debentures with a face value of USS$11,630,000 were purchased by the Ariel Entities for US$269,036, being 2.3% of their face value; that between 7 February 1991 and 8 March 1991, debentures with a face value of US$10,950,000 were purchased by the Ariel Entities for US$163,063, being 1.5% of their face value; that between 14 May 1991 and 17 September 1991, debentures with a face value of USS74,693,000 were purchased by Ariel Entities for US$1,634,000, being 2.2% of their face value; that on 27 August 1993 debentures with a face value of US$1,000,000 were purchased by Mr. Scheiber for US$5,000, being 0.5% of their face value; and that between 26 December 1991 and 15 March 1994, debentures with face value of US$27,643,000 were purchased by the Ariel Entities for US$260,250, being about 1% of their face value.

(2) In June 1990 the applicants "discoverjed] the fraud". In March 1991, the applicants commenced an action in the U.S. District Court against Linter and its officers alleging that the prospectus was fraudulent; in April 1991 they commenced proceedings in that Court against the banks, alleging that the banks aided and abetted the issuance of a fraudulent prospectus. On 17 September 1991 proceedings were commenced

(See the affidavit of Mr. W.H. Roth sworn 28 January 1994 (Ex. 2), filed on behalf of the applicants, tendered in

(It should be noted in this connection that it is not part of the applicants' case in the principal proceedings that they were misled by the alleged misrepresentations in the prospectus (see, for instance, the applicants' response to

request for further particulars (Ex. 3 para.26(g) - (j)-))

(3) The applicants contend, and the present respondents are prepared to accept, for instant purposes only, that a "typical" form of assignment was in the form of a "Transfer

TRANSFER AGREEMENT, dated as of August 8, 1991, by and between the undersigned Seller and_ the undersigned Purchaser. The Seller is the beneficial owner of Linter Textiles Corporation Limited 13 3/4% Senior Subordinated Debentures in the amount listed

The Seller is willing to sell and the Purchaser is willing to purchase the Securities. In connection with and together with its sale of the Securities to the Purchaser through New York Securities Auction Corp., as broker, the Seller will, on the closing date, unconditionally sell, transfer, convey and assign, to the extent transferable, without recourse and without any representations or warranties except as set forth in this Transfer Agreement, all its rights, title and interest in and to any claims or causes of actions, whether arising by contract, operation of law or otherwise (including, without limitation, all causes of action alleged by Seller in the Complaint No. 1655 filed in US District Court, SD of NY on March 8, 1991, and all other causes of action premised on tort, fraud or violations of state, federal or foreign securities or other laws), whether legal or equitable, and whether known or unknown, arising out of or relating to the Seller's (or any predecessor's) acquisition or sale of the Securities, or the Seller's (or any predecessor's) rights as a holder of the Securities. The Seller makes no representation or warranty regarding the validity or effectiveness of any transfer of or the merits of the claims or causes of action. ..."

(4) The applicants tendered (Ex.6) evidence in an affirmation (filed in proceedings brought in New York by the applicants against Skadden Arps Slate Meagher and Flom, New York Attorneys who have now been joined in these proceedings) by Jack N. Mayer, an investment analyst who acted as agent for

the applicants in the acquisition of the subject debentures.

inetrunents that ave puolicly traded in tae securities market and

regularly invest in mo-callea "distressea securities" that are

avallable at a discount From the face value of the instrurencs General.y, these distressed sesurcties ars investments in

businesses that are in the process of oankriptey, reorganization or

Liquidation, or 1n some stner situation chat rakes their financial Bituat.on go vis be

paid so its creditors, an expectation nat hag beer borne out

during tne liquidacson process Tre secorid .ssue, cencerning pricrity of recovery, was in dospu.a ir my experience, this question i6 cycvicaily gupcsect =o a negot.wated resolution Ago a

reeult, I did not believe rhat these depentures were valueless cn

thelr own ana 1t was my oeliezZ tnat some agreeveiz could se reachec

that woutd allow us to obtain a profitaple recovery through tne

In facz I rave bee. advised that as early as June

(5) a question of However, the present parties were prepared to agree, but only for the purposes of this motion, United States with respect to the assignment of rights of

action for fraud and of certain statutory rights is as stated

As was noted in Reasons (No. 1), proof of foreign law is

6A C.J.S. Assignments ss 40, 42 (1991) (at 649-52): "s 40. - Fraud

In the absence of statutory regulations providing otherwise, a right of action for fraud or deceit is generally held nonassignable in those cases in which the wrong is regarded as personal, that is, it is nonassignable where a right of action for tort in general would be nonassignable. On the other hand, it is assignable where it involves the violation of a right of property, or where the injury is regarded as affecting the property or estate, as in a sale of stock, or in the case of a right to set aside a fraudulent conveyance. The right of action is also assignable where it is regarded as arising out of contract, as in the case of an action for the reformation of a contract.

A right of action for fraud or deceit is generally assignable where by statute a cause of action for tort is assignable, or where the statute expressly provides that such cause of action shall survive. Also a right of assignment exists where the statute does not include actions for fraud and deceit in the exceptions to causes of action made assignable, or where it authorizes the assignment of a thing in action arising out of the violation of a right of property or out of an obligation.

The mere fact that the right to enforce a claim which is itself assignable depends on showing fraud incidentally does not make such right of action nonassignable; and the right has been said to be assignable where by the statute assumpsit may be brought for injuries produced by such a wrong, on an implied promise to pay the damages, and the cause of

Right to sue in equity. <A bare right to sue in equity for fraud separate and distinct from a

property right is not assignable as being against public policy and savoring of maintenance. Where, however, the right to sue for fraud is merely incidental to a subsisting substantial property right which has been assigned, and which is itself intrinsically susceptible of legal enforcement, such right to sue for or set up the fraud is generally assignable, and passes as an incident of the assignment or conveyance of the property right; but there is authority to the contrary."

A purely statutory right conferred on one who belongs to a particular class, in the nature of a personal privilege the advantage of which is not intended by the statute to be enjoyed by any other, and which does not survive the beneficiary, is not assignable, as in the case of a penalty or forfeiture accruing under a statute to a particular person who alone may claim or waive it, or in the case of a statute creating a cause of action which is of a nature nonassignable under general rules, as where the right is in its nature personal.

The mere fact, however, that a cause of action is created by statute does not of itself affect its assignability, but the general rules concerning assignability, as discussed supra... control in determining whether it is assignable. A statutory right of action is assignable where the statute imposes a contractual relation, and not a penalty in the strict sense.

A statutory right of action is assignable, if it is one which is vested and affects the property rights or interests of the beneficiary of the statute, and this is the rule where the liability created by the statute rests on the same ground as any other promise to pay. In the absence of any expression of a legislative intent to the contrary, a claim or award for damages for violation of a statute giving redress, compensatory in its nature, is assignable as a property right even though the statute does not expressly extend the remedy to the representatives or assigns of the person aggrieved.

treble damages for violation of the anti-trust laws is assignable on the theory that although the action is for a wrongful act and therefore tortious, the acts declared to be unlawful do not affect the person but the business or property of the assignor and the cause is therefore not ex delicto but comes within the exception of the general rule against

assignment of a thing in action arising out of a tort."

Although it has been stated that one cannot sell a lawsuit, it is generally accepted that the bona fide purchaser or assignee of a mere right of action is not guilty of champerty, maintenance, barratry, or a violation of public policy, except in cases where the rule has been changed by statute ... or except under some, although not all, authority, where the cause of action assigned arose ex delicto.

An assignment of a claim is not rendered illegal by the mere fact that Jlitigation is necessary for collection, and the fact that it may become necessary for the assignee to institute legal proceedings to protect the thing assigned from unjust claims brought against it does not invest the transaction with the character of maintenance.

Indeed, an assignment for the express purpose of bringing suit may not be champertous; an assignment of the causes of action of one party to another asserting an identical claim, for the purpose of bringing one action for the determination of the issues involved, is not open to the objection of champerty. Also, the assignment or sale of a claim, account, or judgment to a collection agent will not be declared champertous, or illegal and void as against public policy, where such a practice has long been recognized in the jurisdiction.

However, a transfer may be champertous in nature where it is merely temporary and colorable and not in good faith, or where there is no consideration therefor other than a promise of the transferee to pay the transferor a part of any recovery that may be obtained, or where the transfer has been made for the exclusive purpose of bringing an action on the claim.

At any rate, an assignment under an agreement that the assignee will enforce or collect the note or claim at his own expense and pay the assignor a share of the proceeds is not champertous where the

assignee gives some other substantial or bona fide consideration. ..."

THE NABILITY NDER_ AUSTRALIAN DOMESTI LAW Fr THE CAUSES OF ACTION PLEADED

It is accepted by the parties for these purposes that claims of the kind now made under Part V of the Trade

Practices Act (ss.52 and 82) are analogous to claims in tort

for fraud or deceit (see Gates v The City Mutual _ Life Assurance Society Limited (1986) 160 CLR 1; Wardley Australia Limited v The State of Western Australia (1992) 175 CLR 514).

It is settled law in Australia that a right to litigate a claim in tort is incapable of assignment at law or in equity (see Poulton v The Commonwealth (1953) 89 CLR 540 at 602). In my opinion, the present claims, being tort claims or

analogous to tort claims, are incapable of assignment.

It is true that in England the law in other areas has developed, e.g. in the context of assignment of contractual causes of action (see Giles v Thompson [1994] 1 AC 142). It seems likely that Australian law will move in a

similar direction so far as concerns claims in contract (see

Re_Timothy's Pty. Ltd. and the Companies Act (1981) 2 NSWLR 706; Re Daley; Ex parte National Australia Bank Ltd. (1992)

37 FCR 390 at 394; Commonwealth v Ling (1993) 118 ALR 309 at

342-3; and see, generally, Meagher, Gummow and Lehane, Equity

In First City Corporation Ltd. v Downsview Nominees Ltd. [1989] 3 NZLR 710, Gault J. was of the opinion, in the

context of the assignment of debentures, that the modern law with respect to maintenance should permit assignment of claims in tort as well as in contract where the tort claims relate to property. Gault J. drew a distinction (at 757) between situations where property is being protected on the one hand and where, on the other the situation is one of the personal advantage of the individual. In my view, even if I were free to depart from the High Court's statement of the position in Poulton so as to follow the opinion expressed by Gault J., it is clear beyond argument that no question arises here of protection of property; and that, rather, this is a case of an assignment of a claim for unliquidated damages for deceit, or something analogous to such a claim, for the benefit of the

In Park v Allied Mortgage Corporation Limited (1993) ATPR 53,467, Davies J. said (at 53,469):

"In my opinion, a right to claim damages under ss.82 and 87 of the frade Practices Act 1974 (Cth) is, in general, a bare right of action which cannot be assigned. I am not speaking of an assignment such as may occur on the bankruptcy or death of a person or on the merger of a company into another entity. Absent such special circumstances, a right to claim

under ss.82 and 87 cannot, in my opinion, be assigned. Section 82 provides:-

'(1) A person who suffers loss or damage by conduct of another person that was done in

contravention of a provision of Part IV or V may recover the amount of the loss or damage by action against that other person or against any person involved in the contravention.'

fhe section does not allow for the award of damages in respect of a loss which was not suffered by any party to the proceedings. Both the terms of the statutory provision and the principle as enunciated

in cases such as Dawson v Great Northern & City Railway Co. (1903) 1 K.B. 260 at 270-1, Defries v

Milne [1913] 1 Ch. 98 and Poulton v The Commonwealth (1953) 89 C.L.R. 540 at 602, preclude Mrs Regan from suing for damages in respect of any loss suffered by Mr and Mrs Park. Mr and Mrs Park have discontinued their claims and that is an end to them.

The assignment has effect, however, insofar as it assigns to Mrs Regan all the entitlement of Mr and Mrs Park under the mortgage into which all the applicants had entered as mortgagees. fThus, if any ancillary relief under s.87 depends upon the approval or request of the mortgagors, the remaining applicants now hold all interests in respect thereof."

I agree. Indeed, in my view, the contrary is not reasonably arguable. Again, a distinction must be drawn between a proprietary situation and the position of the potential personal advantage of an individual. In my opinion, it is clear beyond argument that the claims now made fall into the latter and not the former category. It cannot, in my view, be reasonably argued that the "typical" assignment could operate so as to protect property or any proprietary rights so far as concerned the debentures. This litigation is, beyond question, concerned only with the recovery of damages for the

It follows that I have concluded that it is clear beyond argument that the claims in tort for fraud and the analogous claims under Part V of the Trade Practices Act are

PRIVATE INTERNATIONAL LAW ASPECTS (a) Choice of law rules

As has been seen, there appear to be differences between the Australian law and American law on the question whether the present claims were capable of assignment. On behalf of the respondents, it is submitted that it is clear, beyond argument, that Australian domestic law rather than American domestic law governed the determination of the question. However, the applicants disputed this and further argued that, at the least, this question raised a triable

In the first place, it will be noted that the present problem has at least a dual aspect. On the one hand, for P.I.L. purposes, the claims, the subject of the

assignments, may be characterised as tortious (including the

claims under Part V of the Trade Practices Act in its extraterritorial operation under s.5(1)). This characterisation is common ground. On the other hand, so far at least as an express assignment of the claims is relied on, it is at least arguable (although disputed) that the assignments are contractual and thus governed by the proper law of the contract of assignment. This is, of course, a different question from that arising under the choice of law

rules for foreign tort claims (as to the position in tort see

On behalf of the respondents, much reliance was placed upon some observations by Lord Denning M.R. in Trendtex Trading Corporation. v Credit Suisse [1980] 1 QB 629 (at 652) with respect to the validity of the assignment of certain contractual rights. Reference was there made to the chose in action, the alleged right of action, being "reduced into the possession of [the assignor] by the issue of a writ in the High Court of England". The chose of action was thus said to be "situate in England". But the writ there was issued before the purported assignment. It follows that it is at least arguable that this reasoning is not applicable here since the assignment in this matter preceded the institution of

placed upon a series of cases dealing, inter alia, with the

conflicts rules with respect to the applicability of the proper law or the lex situs in the case of certain choses in

action, for instance, claims under a bill of lading

(Sutherland v Administrator of German Property [1934] 1 KB 423), under a policy of insurance (F. & K. Jabbour v Custodian of Israeli Absentee Property [1954] 1 WLR 139), and under a lease of moveables (In Re United Railways of the Havana and Regia Warehouses Ltd. [1960] 1 Ch. 52). However, it is

apparent that the application of these rules in those cases was a matter of considerable difficulty, complexity and contention. It is not possible, in my view, to say, as the respondents suggest, that the outcome in this case is beyond argument, any more than it was in those decided cases. Once, as here, a foreign element is involved, questions of identification of the relevant choice of law rules, let alone their application, inevitably lead to complicated issues. The present case is no exception and raises, in this connection, a

Similar considerations apply here. As was noted earlier, it is now said on behalf of the present respondents that even if the American law were prima facie applicable, an Australian court would, as a matter of public policy, refuse

strike out application. Even if one were to accept, as a general proposition, that an Australian court should adopt this approach if the content of the foreign law warrants it, that adoption of such an approach in the present case as_a Matter beyond argument is impossible. In my view, the comments made by the High Court in Wardiley, above, at 533-4, 541 and 558-9, of the need for the court to know all the circumstances before making a final judgment on a question of undoubted complexity are apposite here. As the High Court there pointed out, an interlocutory application of the present kind is not the appropriate vehicle for issues of this complexity where the details of the evidence given at the

costs Because each party has now had some measure of

success, I propose to make no order for costs in respect of

I certify that this and the preceding twenty-two (22) pages are a true copy of the Reasons for Judgment herein of his Honour Mr. Justice Beaumont.

Counsel and Solicitors Mr. A.R. Emmett Q.C. instructed for Applicants: by Sly & Weigall Counsel and Solicitors Mr. J.H. Karkar Q.C. instructed for Fifth and Sixth by Mallesons Stephen Jaques Respondents: Dates of hearing: 31 October - 2 November 1994

Practices Act 1974(Cth)

At a glance

Court

Decision date

Before

Source

Judgment (149 paragraphs)

Parties

Legislation Cited (1)

Cases Cited (6)