The applications before the Court
20 The four interlocutory applications are made under s 1337H of the Corporations Act 2001 (Cth) to transfer the proceeding to the Supreme Court of New South Wales. There is no appeal from a decision of this character: s 1337R.
21 Given the background to the proceedings and the importance of the legal points to which I will come, I considered that the matter was of sufficient importance to make a direction under s 20(1A) of the FC Act for the jurisdiction of the Court in relation to the applications to be exercised by a Full Court.
22 The applications were supported and contested by various affidavits read by the parties. It is unnecessary to refer in any detail to the matters traversed by the affidavits. It can be accepted that AMP has its head office in Sydney, but its operations are nationwide. The place of residence of individual lead plaintiffs is of little relevance when group members are Australia-wide. Convenience of (and so perhaps cost of) lawyers is a consideration, but as a national court the Federal Court could hear the case, including case management hearings, anywhere in Australia.
23 All this is by the by, however, as the Supreme Court has refused to transfer the Wigmans proceeding. None of what might be called the usual considerations in a forum conveniens or transfer application outweigh the convenience of ensuring only one substantive hearing. No party put the submission that two proceedings (one in this Court and one in the Supreme Court) could be managed simultaneously and co-operatively. This kind of inter-court co-operation has a precedent in large insolvency litigation in the United States and Canada in the Nortel Case: see Nortel Networks Corporation (Re), [2015] ONSC 2987; In re Nortel Networks Inc., et al., Debtors 532 BR 494 (2015). The very similar nature of the cases here means that that co-operative expedient is perhaps not necessary. What does need to happen, however, is that a careful and balanced case management analysis be made as to which one or more of the five proceedings go ahead to resolve the issue for the lead plaintiff or plaintiffs and group members, and on what terms. This is an important decision, not without its commercial and professional aspects. To this question the interests of group members are paramount. At the risk of criticism for repetition, it should be obvious that this important decision, so vital to group members, should not be forestalled by an anti-suit injunction seeking to protect the first suit filed.
24 Were it not for the legal issues raised by some of the applicants in the proceedings I would transfer the applications to the Supreme Court in the anticipation that the judge managing the proceedings will consider which one or more of the proceedings should proceed, and on what terms as to funding terms and fee, legal costs and management of the litigation.
25 I gave some consideration to the question as to whether this Court would conduct a "carriage motion" among the four Federal Court proceedings and transfer one or more proceedings to the Supreme Court (staying the others), enabling a second carriage motion involving the Wigmans proceedings to be heard in the Supreme Court. On reflection, it would be better to transfer the four proceedings to the Supreme Court so that Court can decide which one or more actions should go forward, taking into account all relevant matters and the best interests of the group members.
26 The arguments in opposition to this course are of importance. They were arguments most forcefully put on behalf of the interests behind the Komlotex proceedings.
27 Each of the proceedings raises claims under the Corporations Act, seeking declarations and compensation orders under Part 7.10 of the Corporations Act in particular under s 1041I. Proceedings for a declaration of contravention and a compensation order "may be started no later than 6 years after the contravention": s 1317K of the Corporations Act. The Wigmans proceedings also contain claims for declarations of contraventions of the Corporations Act and compensation orders under s 1041I.
28 If representative proceedings are commenced, subject to the matters in the following paragraph, s 33ZE(1) suspends the time limitations as contained in s 1317K. Section 33ZE of the FC Act provides as follows:
33ZE Suspension of limitation periods
(1) Upon the commencement of a representative proceeding, the running of any limitation period that applies to the claim of a group member to which the proceeding relates is suspended.
(2) The limitation period does not begin to run again unless either the member opts out of the proceeding under section 33J or the proceeding, and any appeals arising from the proceeding, are determined without finally disposing of the group member's claim.
29 AMP argued, and during argument it appears to have been conceded by Komlotex, that the commencement of proceedings under s 33C "on behalf" of group members (see the definition of "group member" under s 33A) was the "start" of proceedings for the purposes of s 1317K, by each group member. Given the way the argument proceeded it is unnecessary to express a final view, but for my part, the proceeding is commenced (that is, started) by the persons referred to in s 33C(1) as the persons representing the group. On this hypothesis, the group members do not commence or start proceedings; another or others commence proceedings on group members' behalf. If group members start the proceeding, s 33ZE(1) would have little work to do until an engagement of the circumstances in s 33ZE(2).
30 On the other hand, taking s 33ZE(1) as relevantly operative, one law of the Commonwealth Parliament (s 33ZE(1)) suspends for all group members the running of time under another law of the Parliament (s 1317K) until the events contemplated by s 33ZE(2) occur.
31 Part 10 of the Civil Procedure Act 2005 (NSW) (CP Act) is in similar terms and structure to Part IVA of the FC Act in providing for representative proceedings. Section 182 of the CP Act (the equivalent of s 33ZE) is in the following terms:
182 Suspension of limitation periods
(1) On the commencement of any representative proceedings, the running of the limitation period that applies to the claim of a group member to which the proceedings relate is suspended.
(2) The limitation period does not begin to run again unless either the member opts out of the proceedings under section 162 or the proceedings, and any appeals arising from the proceedings, are determined without finally disposing of the group member's claim.
(3) However, nothing in this section affects the running of a limitation period in respect of a group member who, immediately before the commencement of the representative proceedings, was barred by the expiration of that period from commencing proceedings in the member's own right in respect of a claim in the representative proceedings.
(4) This section applies despite anything in the Limitation Act 1969 or any other law.
32 Section 162 of the CP Act concerning opt out, and referred to in s 182(2), provides as follows:
162 Right of group member to opt out
(1) The Court must fix a date before which a group member may opt out of representative proceedings in the Court.
(2) A group member may opt out of the representative proceedings by written notice given under the local rules before the date so fixed.
(3) The Court may, on application by a group member, the representative party or the defendant in the proceedings, fix another date so as to extend the period during which a group member may opt out of the representative proceedings.
(4) Except with the leave of the Court, the hearing of representative proceedings must not commence earlier than the date before which a group member may opt out of the proceedings.
33 Sections 1337N and 1337P of the Corporations Act provide for the effect of transfer of proceedings as follows:
1337N Transfer of documents
If, under section 1337H, 1337J or 1337K, a court (the transferor court) transfers a proceeding, or an application in a proceeding, to another court:
(a) the Registrar or other proper officer of the transferor court must transmit to the Registrar or other proper officer of the other court all documents filed in the transferor court in respect of the proceeding or application, as the case may be; and
(b) the other court must proceed as if:
(i) the proceeding had been originally instituted in the other court; and
(ii) the same proceedings had been taken in the other court as were taken in the transferor court; and
(iii) in a case where an application is transferred - the application had been made in the other court.
1337P Conduct of proceedings
(1) Subject to sections 1337S, 1337T and 1337U, if it appears to a court that, in determining a matter for determination in a proceeding, the court will, or will be likely to, be exercising relevant jurisdiction, the rules of evidence and procedure to be applied in dealing with that matter are to be the rules that:
(a) are applied in a superior court in Australia or in an external Territory; and
(b) the court considers appropriate to be applied in the circumstances.
(2) If a proceeding is transferred or removed to a court (the transferee court) from another court (the transferor court), the transferee court must deal with the proceeding as if, subject to any order of the transferee court, the steps that had been taken for the purposes of the proceeding in the transferor court (including the making of an order), or similar steps, had been taken in the transferee court.
(3) In this section:
relevant jurisdiction means:
(a) jurisdiction conferred on the Federal Court of Australia or the Family Court with respect to civil matters arising under the Corporations Legislation; or
(b) jurisdiction conferred on a court of a State, the Capital Territory or the Northern Territory with respect to matters referred to in subsection 1337B(3).
34 Notwithstanding that during argument Komolotex accepted that commencement of the four proceedings in the Federal Court had the effect of group members starting proceedings for the purposes of s 1317K, it still argued that group members would be prejudiced by any transfer.
35 The argument was that transfer to the Supreme Court would destroy that suspensive protection of s 33ZE(1). This affectation was, it was submitted, the consequence of the change to the character of the proceedings brought about in the transfer, and the lack of application of s 182 of the CP Act to suspend a limitation provided for under a law of the Commonwealth Parliament. That is, s 79 of the Judiciary Act 1903 (Cth) does not pick up s 182 in the face of s 1317K. How this caused prejudice if group members are to be taken to have started proceedings for the purposes of s 1317K is not clear to me.
36 Nevertheless, I deal with why this submission should not be accepted in steps.
37 The first step is the effect of transfer of proceedings begun in the Federal Court under s 33C. It was submitted that s 1337N when read with s 1337P meant that the Corporations Act transformed the proceedings commenced in the Federal Court. They were now to be treated (as the fact) as having been commenced in the Supreme Court. In Webster (Trustee) v Murray Goulburn Co-operative Co Limited (No 3) [2018] FCA 990 at [26], Beach J said that a proceeding transferred to the Federal Court was to be "treated as being brought under Pt IVA of the [FC Act]". (See also Webster (Trustee) v Murray Goulburn Co-operative Co Ltd [2017] VSC 249 at [1]-[6].) That ss 1337N and 1337P require the transferee court to thereafter treat the proceeding as if it had been commenced there does not somehow deny or obliterate the fact of the antecedent protection provided by s 33ZE(1), by the event of commencement that in fact occurred. Transfer does not destroy the effect of s 33ZE(1). The words of ss 1337N and 1337P do not dictate that it be taken there was no commencement in the Federal Court. If it did, however, such protection by suspension would occur in any event through s 182(1) operating if picked up by s 79 of the Judiciary Act 1903 (Cth) (as it is, for the reasons below).
38 Then it was argued that the suspensory effect of s 33ZE(1) is conditioned on Pt IVA continuing to apply. Upon any transfer, s 33ZE(2) can no longer apply and it must be taken that s 33ZE(1) is somehow exhausted in its operation. I do not accept that submission. Section 33ZE(1) is plain in its terms and effect. Transfer of proceedings under a provision of a Commonwealth statute such as s 1337H (or under some cognate statute) can be anticipated in respect of proceedings under Part IVA of the FC Act. Sections 1337N and 1337P will see the once Federal Court proceedings continue under the CP Act as if they had been commenced in the Supreme Court. One looks to the statute that governs such proceedings in the Supreme Court to understand the legal regime under which the proceedings will continue. Under s 182(2) (if adopted by s 79 as a federal law), if a group member opts out or the other circumstances in s 182(2) occur, the suspension imposed by s 33ZE(1) would end. If this view about the continuing operation of s 33ZE(1) until circumstances in s 182(2) affect it be wrong, then from the time of transfer s 182(1) may be seen to operate in identical fashion to s 33ZE(1) once it is picked up. I accept that the terms of s 1337N and 1337P and the form and structure of s 33ZE(1) and (2) can be taken to found a view that upon transfer s 182(1) and (2) govern suspension and the end of suspension, not s 33ZE(1) and s 182(2). I would prefer the view that I have expressed. In the end, it matters not: there is a suspension and the lifting of a suspension provided for.
39 The legal regime under which the transferred proceedings continue appears to be under State statute. The proceedings are in federal jurisdiction. A State Parliament is incapable of enacting a valid law which governs the exercise of federal jurisdiction by a Court, whether federal or State: Rizeq v Western Australia [2017] HCA 23; 344 ALR 421 at [63]. That, however, explains the function of s 79 and also explains the proper nature and extent of its operation: Rizeq at 435 [63]. There the plurality said:
The incapacity of a State Parliament to enact a law which governs the exercise of federal jurisdiction by a court, whether it be a federal court or a State court, explains the necessity for s 79 of the Judiciary Act and is the key to understanding the nature and extent of its operation. Section 79 is a law, enacted under s 51(xxxix) of the Constitution, which serves to ensure that the exercise of federal jurisdiction is effective. The section fills a gap in the law governing the actual exercise of federal jurisdiction which exists by reason of the absence of State legislative power. The section fills that gap by picking up the text of a State law governing the exercise of State jurisdiction and applying that text as a Commonwealth law to govern the manner of exercise of federal jurisdiction. The section has no broader operation.
40 There was no debate that a law such as s 182 of the CP Act was a law of a State governing the exercise of State jurisdiction and if picked up would govern the manner of exercise of federal jurisdiction, just as State statutes of limitation can be, and often are, picked up.
41 But, Komlotex submitted, s 182 was not picked up by s 79 of the Judiciary Act because it was in conflict with the terms and operation of s 1317K.
42 Section 79 of the Judiciary Act is relevantly in the following terms:
79 State or Territory laws to govern where applicable
(1) The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable.
…
43 Section 1317K "otherwise provided", it was submitted, because its ambit and operation were irreconcilable with the direct terms of s 182, which derogated from the operation of the Commonwealth law: see Austral Pacific Group (in liq) v Airservices Australia [2000] HCA 39; 203 CLR 136 at 144 [17]; Northern Territory v GPAO [1999] HCA 8; 196 CLR 553 at 587-589 [78]-[84], 606 [135], 650 [254]; Grant Samuels Corporate Finance Pty Ltd v Fletcher [2015] HCA 8; 254 CLR 477 at 487 [23].
44 This argument that a Commonwealth law (s 1317K) "otherwise provided" so that s 182 is not picked up was put, in part, on the basis that s 1317K did not just deal with a remedy but created a substantive right or was "jurisdictional". Reliance was placed on the decision of Almond J in Austructures Pty Ltd v Makin [2014] VSC 544; 290 FLR 153. It is unnecessary to consider the correctness of that view (upon which I do not intend to cast doubt) because it matters not whether the provision (s 1317K) goes to a remedy or a right. Its operation (if looked at in isolation) would be derogated from by s 182 if that provision were picked up; that is, if that were the correct question to ask.
45 The answer to this submission is that to look only to the text of s 1317K and the derogation from its operation if s 182 is picked up is too narrow a focus. Section 79 used the phrase "laws of the Commonwealth".
46 In construing relevant statutes, State and Commonwealth, in the working through of provisions for the operation of an integrated federal judicature one should adopt an approach to construction, as far as the words of any relevant statute permit, that aids the smooth working of that judicature, not an approach that uncovers difficulty or inconvenience.
47 The Commonwealth Parliament has enacted two laws - s 1317K of the Corporations Act and s 33ZE of the FC Act that deal with time limits in relation to certain proceedings arising under a law of the Parliament and to be vindicated in federal jurisdiction by representative proceedings in the Federal Court. It must be taken that it was plain to Parliament that such claims could be brought in State Courts as well as the Federal Court if Parliaments of different polities adopted representative proceedings legislation. It is not to be presumed that Parliament intended a suspension of time running if representative proceedings were commenced in the Federal Court, but no suspension if the representative proceedings were brought in a State Supreme Court operating under a cognate legislative regime as the Federal Court under Part IVA of the FC Act. The proper approach is to look at the relevant Commonwealth laws (s 1317K and s 33ZE) and ask whether such otherwise provide, preventing s 182 being picked up. Once that correct question is posed, the answer is obvious: no, there is no derogation and Commonwealth laws do not otherwise provide. Section 182(1) and (2) being picked up will provide, in substance, the same regime of suspension for group members as does s 33ZE(1) and (2) in relation to claims under Commonwealth law commenced in the Federal Court and otherwise limited by s 1317K. There is no derogation and no inconsistency.
48 Thus, I would reject the submission that s 182 of the CP Act is not picked up by s 79 of the Judiciary Act in the Wigmans proceeding or the four proceedings in this Court if transferred to the Supreme Court.
49 It is unnecessary to deal with the remedy or right point. Whether or not AMP's undertaking in the Wigmans proceeding not to plead s 1317K is effective, the same position, if it be a difficulty, will obtain in relation to any of the proceedings.
50 Once the Federal Court proceedings are transferred to the Supreme Court, the provisions of Pt 10 of the CP Act will apply to the conduct of the proceedings in federal jurisdiction: s 79 of the Judiciary Act and ss 1337N and 1337P of the Corporations Act. Thereafter, the protection afforded by s 33ZE(1) (or s 182(1)) will be affected by any opt out under s 162 because of the terms of s 182(2), both picked up and made applicable by s 79. Once picked up by s 79, provisions such as s 162 (on opt out) and s 182 apply as federal law.
51 Thus if a group member opts out under s 162 (now federal law through the picking up by s 79), s 182(2) operates to end the suspension. Section 182(2) is relevantly identical to s 33ZE(2) and so, like s 182(1), is picked up by s 79.
52 It should be noted that no other disadvantage to group members was asserted to flow from transfer to the Supreme Court applying Pt 10 of the CP Act compared to Pt IVA of the FC Act. The arguments in these applications, however, illuminate the wisdom of and need for the representative proceedings regimes of the Commonwealth and States to be substantially identical. In the face of competing class actions it may be difficult to require a group to be transferred to a Court where there would be some lessening of procedural and substantive rights. For instance, if s 182 provided for suspension or lifting of suspension in a manner more unfavourable to group members than s 33ZE that would be a consideration militating against transfer, and it may affect the question of "otherwise provided" under s 79.
53 There is no appeal from an order for transfer: s 1337P. This Court is, of course, amenable to the operation of s 75(v) of the Constitution, though any error of this Court in statutory construction in deciding a transfer application may not amount to necessary jurisdictional error. These are important questions. If Komlotex's submissions are correct and the above analysis is wrong, damage may possibly be done to the legal interests of group members by the transfer. It is not clear how that damage could be done if the concession made by Komlotex is correct in that the beginning of representative proceedings by a lead plaintiff on behalf of group members amounted to those group members starting proceedings for s 1317K. However, I have difficulty with that concession and the statutory interpretation underlying it. In these circumstances, the Court raised the issue of whether declaratory relief should be given that would provide an avenue for special leave if any party thought it appropriate. Such declarations could be to the effect that the transfer of proceedings to the Supreme Court does not affect the suspension of the running of any limitation period by s 33ZE(1) of the FC Act, or s 33ZE(1) and then s 182(1) of the CP Act, and that the operation of the suspension of the running of the limitation period commenced by s 33ZE(1) or s 182(1) will thereafter be governed by s 182(2) of the CP Act upon transfer of the proceeding to the Supreme Court. Given the view I have of the arguments the making of the declarations will not prejudice group members. But if the view underlying the declarations is based on error group members could ultimately be prejudiced. The making of declarations will facilitate an application for special leave if thought appropriate.
54 I would therefore delay making orders transferring the proceedings to the Supreme Court for 28 days, or a shorter period should the parties decide not to seek special leave to appeal to the High Court.
55 Given the importance of the questions and the proximity of Constitutional considerations, I would also direct that a copy of these reasons be served on all State, Territory and the Commonwealth Attorneys-General and Solicitors-General. Komlotex should undertake this task as the propounder of the points in question.
56 The orders that I would make in each proceeding are as follows:
(1) Order that upon the expiry of 28 days, or such shorter or longer period as the Court may order, the proceeding be transferred to the Supreme Court of New South Wales pursuant to s 1337H of the Corporations Act.
(2) Declare that, in respect of proceedings to which s 1317K of the Corporations Act applies, upon the transfer of the proceeding provided for in order 1, s 33ZE(1) of the FC Act continues to apply to group members to which these proceedings relate according to its terms until any relevant operation of s 182(2) of the CP Act picked up by s 79 of the Judiciary Act, or, alternatively, upon said transfer s 182(1) and (2) of the CP Act apply to group members to which these proceedings relate by s 79 of the Judiciary Act.
57 I would hear the parties as to costs.
I certify that the preceding fifty-seven (57) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Chief Justice Allsop.