defendant. The Court ordered: (i) that the District Court proceedings be transferred to the Supreme Court; (ii) that the Summons otherwise be dismissed (thereby refusing the re-transfer to the District...
Key principles
Section 146(1) of the Civil Procedure Act 2005 requires that proceedings 'could properly have been commenced' in the lower court as a condition precedent to transfer; this...
The expanded jurisdiction available under s 51(2)(b) of the District Court Act 1973 (permitting judgment up to 150% of the jurisdictional limit where no timely objection is...
The use of transfer procedures to circumvent jurisdictional limits—by removing proceedings to the Supreme Court and then seeking re-transfer to the District Court to take...
The legislative policy underlying jurisdictional limits on the District Court, as reflected in s 146(4) of the Civil Procedure Act 2005, weighs against permitting procedural...
Issues before the court
Whether proceedings commenced in the District Court where the claim exceeded the jurisdictional limit could be characterised as 'properly commenced'...
Plain English Summary
A worker who was injured sued his employer's property owner in the District Court, claiming over $1 million in damages. At the time, the District Court could only award up to $750,000 against this type of defendant unless the defendant consented or failed to object in time. The worker tried to get around this by asking the Supreme Court to take the case and then send it back to the District Court, which would have allowed the District Court to award more than $750,000. The Supreme Court refused. It held that the case was not 'properly commenced' in the District Court because the claim exceeded the court's limit at the time it was filed. The Court also found this procedural manoeuvre was an abuse of process because it was designed to deprive the defendant of the protection of the jurisdictional limit. The case stayed in the Supreme Court and the worker had to pay the legal costs.
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Judgment (3 paragraphs)
[1]
Judgment
By Summons filed on 2 October 2015 the Plaintiff seeks orders:
1. An order pursuant to section 140(1) of the Civil Procedure Act 2005, that Case Number 2013/232657 be removed from the District Court of New South Wales at Sydney to the jurisdiction of this Honourable Court.
2. After giving effect to the orders of the Court as referred to in paragraph 2 an order that these proceedings be transferred from the Supreme Court to the District Court pursuant to section 146(1).
3. An order that the First Defendant pay the costs of this Application.
4. Such other orders as this Honourable Court deems fit.
Whether the Plaintiff's proposed course—transfer to Supreme Court followed by re-transfer to District Court—constituted an abuse of process.
Whether, as a matter of discretion, the Court should order re-transfer to the District Court under s 146(1) of the Civil Procedure Act 2005.
Cited legislation
No linked legislation citations have been extracted yet.
So far as is relevant s 146 of the Civil Procedure Act 2005 provides:
(1) If the Supreme Court is satisfied, in relation to proceedings before it:
(a) that the proceedings could properly have been commenced in the District Court or the Local Court, and
(b) that any cross-claim in the proceedings could properly have been brought as a cross-claim in the District Court or the Local Court,
the Supreme Court may order that the proceedings, including any such cross-claim, be transferred to the District Court or to the Local Court, as the case requires.
(2) ...
(3) In determining:
(a) whether any proceedings could properly have been commenced in the lower court, or
(b) whether any cross-claim could properly have been brought in the lower court,
the higher court must have regard to the current limits of the lower court's jurisdiction as if they had been the limits of that jurisdiction when the proceedings were commenced, or the cross-claim brought, in the higher court.
(4) Proceedings in the Supreme Court on a claim for damages arising from personal injury or death are to be transferred under this section unless the Supreme Court is satisfied:
(a) in the case of a motor accident claim or workplace injury damages claim:
(i) that the amount to be awarded to the plaintiff, if successful, is likely to be more than $1,000,000, and
(ii) that the case involves complex legal issues or issues of general public importance, or
(b) in any other case:
(i) that the amount to be awarded to the plaintiff, if successful, is likely to exceed the jurisdictional limit of the District Court, or
(ii) that there is other sufficient reason for hearing the proceedings in the Supreme Court.
(5) This section extends to proceedings that have been transferred to the Supreme Court or the District Court pursuant to a previous transfer order under Division 1.
Significant to the application is also s 51 of the District Court Act 1973. So far as is relevant that section provides:-
(1) This section applies to an action or cross-claim that, but for this section, the Court would not have jurisdiction to hear and dispose of by reason only of the fact that the amount claimed exceeds the jurisdictional limit of the Court as at the time the action was commenced.
(2) The Court has, and may exercise, jurisdiction to hear and dispose of an action or cross-claim to which this section applies:
(a) if a party to the action or cross-claim files a memorandum of consent in respect of the action or cross-claim, or
(b) if no objection to the Court's jurisdiction has been raised by any of the parties prior to 3 months before the trial of the action commences.
(3) …
(4) The maximum amount for which judgment may be given in relation to an action or cross-claim that is dealt with pursuant to subsection (2) (b) is an amount equivalent to 50 per cent above the jurisdictional limit of the Court as at the time the action was commenced.
It is agreed between the parties that at the time the Statement of Claim was filed there was no limit to the amount the District Court could award in the case of actions against employers but, at least so far as someone in the position of the First Defendant is concerned, the jurisdictional limit of that court was $750,000.
The District Court proceedings sought to be dealt with were commenced against the First Defendant on 31 July 2013. They arise out of an injury the Plaintiff suffered at premises owned by the First Defendant while the Plaintiff was employed by the Second Defendant. During the hearing before me, the District Court Statement of Claim was not tendered but after I inquired what the claim was, I was provided with a Statement of Particulars filed on 13 September 2013, which included as amounts claimed by the Plaintiff:
Past economic loss $190,598.10
Future economic loss $293,230.05
Fox v Wood entitlement
Past attendant care approximately $9,000.00 per annum
Future attendant care approximately $12,000.00 per annum
Future operations and radiology $25,000.00
Future OOP expenses $2,990.00 per annum
[2]
An affidavit from the Plaintiff's solicitor also remarked that at the time of the filing of the Statement of Claim, the Workers Compensation payback totalled approximately $200,000. It now appears to be approximately $523,000. Even ignoring this increase it seems likely that, if successful, the Plaintiff's damages might well have exceeded $750,000.
I was also provided with a more recent opinion by Senior Counsel for the Plaintiff to the effect that if the plaintiff is successful the damages may well amount to $1,075,450. The opinion contains details of how that figure is calculated. These and the opinion were not challenged and I see no reason not to accept the latter as a realistic assessment of the damages the Plaintiff is likely to receive if he is successful.
By letter of 1 October 2015 the First Defendant has indicated that it is not disposed to consent to the District Court having unlimited jurisdiction. Given that the matter has not been listed for trial, the First Defendant would thus seem to have complied with the time limit referred to in s 51 (2)(b).
No party opposed the transfer of the proceedings to this Court and given the matters to which reference has been made, that order should be made. The First Defendant however objected to the matter being transferred back to the District Court.
The first ground of objection was that the condition in s 146 (1) "that the proceedings could properly have been commenced in the District Court" did not exist because the claim exceeded the jurisdictional limit of that court. The Plaintiff sought to meet this by asserting that as, in the absence of objection by the Defendant, the District Court could give judgment for 150% of the amount stipulated as its jurisdictional limit, and the Plaintiff's claim fell within this expanded limit, the proceedings were properly commenced.
The First Defendant's objection is upheld. The problem with the Plaintiff's argument is that, if the determination as to "properly commenced" is to be determined by what does or might subsequently occur, all actions will be properly commenced. The argument that an action is properly commenced provided that the damages claimed or that can be awarded do not exceed that 150% figure must apply also to an action where the amount claimed or awarded (perhaps many times over the District Court's jurisdictional limit) depends for its effectiveness on a Memorandum of Consent, which can be filed at any time.
Section 146 (1) of the Civil Procedure Act cannot have been intended to have that sort of operation.
The Plaintiff's second ground of objection was that the course sought to be implemented by the Plaintiff amounted to an abuse of process calculated to have the District Court adjudicate on claims not initially within its jurisdictional limit but which could be decided free of such a limit because transferred from this Court - See District Court Act 1973. Reliance was placed on a decision of Studdert J in Ge v River Island Clothing Pty Ltd [2001] NSWSC 935 wherein his Honour said, at [20]:-
It does seem to me that the present case however does constitute such an abuse. Notwithstanding Mr Cleary's earnest submissions to the contrary, the submissions advanced by Mr Graves ought, in my opinion, to prevail. It seems to me that what was done involved the use of the transfer processes provided for in Pt III Div 9 of the District Court Act in a manner that was never intended, and in a manner which deprived the appellants of their legitimate expectation that, absent consent to the unlimited jurisdiction of the District Court, that court's jurisdiction would be limited to $750,000.
The Plaintiff sought to meet this argument by drawing attention to s 56 of the Civil Liability Act, asserting that within the next week or so the District Court would be willing to fix a trial date during next April or May, and that any Supreme Court hearing was likely to be attended with additional steps and costs. Against this, counsel for the First Defendant suggested that the conclave process normally employed in this Court would be calculated to assist the parties. I was informed also that the expert evidence is "all largely served" and that on 16 September an Informal Settlement Conference was held.
For matters of the length of what I anticipate this case will take, hearing dates in about May next are available in this Court so I do not regard delay as a significant factor. I accept that costs in this Court will probably be higher, but against the legislative policy of imposing jurisdictional limits on the District Court I do not regard that fact either as of substantial weight.
The Plaintiff's third ground was that, as a matter of discretion, the Court should not order a transfer back. Given the conclusion at which I have arrived in respect of the First Defendant's first ground, it is unnecessary for me to make a decision on the third. I should say however that I agree with Studdert J's description of the Plaintiff's actions and if I did have to make a decision in the exercise of any discretion I would not order a transfer back to the District Court.
In the result, the prayer for re-transfer of the proceedings to the District Court must be dismissed. In the result the Plaintiff has succeeded in the first prayer but that was not opposed and was necessary principally because the Plaintiff chose to commence proceedings in a Court which, in the circumstances, does not have jurisdiction. The Plaintiff has failed on his second prayer, which was the only one, the subject of controversy. In the circumstances the Plaintiff should pay the cost of the First Defendant.
The Plaintiff also joined the Second Defendant to the application. That Defendant should also have its costs of the Summons but as a submitting Respondent, as it in fact was.
It may be appropriate to add some direction aimed at having the trial proceed without delay but otherwise my orders are:-
(i) Order that Proceedings 2013/232657 in the District Court between John Sheedy as Plaintiff and State Asphalt Services Pty Ltd and J & E Excavations & Plant Hire Pty Limited as Defendants be transferred to this Court.
(ii) Otherwise the Summons herein is dismissed.
(iii) The Plaintiff is to pay the costs of the Defendants of and incidental to these proceedings, in the case of the Second Defendant as a submitting Defendant.
[3]
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Decision last updated: 22 October 2015
The Court ordered: (i) that the District Court proceedings be transferred to the Supreme Court; (ii) that the Summons otherwise be dismissed (thereby refusing the re-transfer to the District Court); and (iii) that the Plaintiff pay the costs of both Defendants, with the Second Defendant's costs to be as a submitting defendant.