CATCHWORDS Practice and Procedure - Interlocutory injunctions - Application for injunction to restrain respondent proceeding with an action in Supreme Court of N.S.W. - Applicant's Federal Court claim against respondent under Trade Practices Act 1974, Part IV - Respondent's Supreme Court claim for winding up of applicant - Whether Federal Court has jurisdiction to hear application - Constitutional issue potentially involved - Pending High Court decision ~ Factors to be considered in hearing such application. Judiciary Act 1903,s. 78B Trade Practices Act 1974, ss. 46, 47, 48, 82 NOVASONIC CORPORATION PTY. LIMITED v. HAGEMEYER (AUSTRALASIA) B.V. No. G4 of 1983 CORAM: Lockhart J. 26 August 1983 Sydney IN THE FEDERAL COURT OF AUSTRALIA ) - oY - NEW SOUTH WALES DISTRICT REGISTRY ) No. G4 of 1983 ) GENERAL DIVISION } BETWEEN: NOVASONIC CORPORATION PTY. LIMITED Applicant AND: HAGEMEYER (AUSTRALASIA) B.V. Respondent ORDER JUDGE MAKING ORDER: Lockhart J. DATE OF ORDER: 26 August 1983 WHERE MADE: Sydney THE COURT ORDERS: 1. That the respondent be restrained until further order from seeking to be substituted as the plaintif£ in action No. 3900 of 1982 in the Supreme Court of New South Wales Equity Division or otherwise proceeding further with such action. 2. That each party be at liberty to restore to the list on two days notice the applicant's motion of 3 August 1983 and the application for damages under s. 82. 4. 2. That the costs of this motion be the applicant's costs in proceedings in this Court in matter G4 of 1983. That the applicant shall, on or before Thursday 1 September 1983, file and serve on the respondent and on the Attorneys-General of the Commonwealth and New South Wales a notice of a constitutional matter which shall comply with sub-rules 1(ii) and (ii21) of Order 51 mutatis mutandis and which shall state the date to which this matter is to be adjourned. The applicant shall file an affidavit of the service of the said notice on or before Wednesday 7 September 1983. The application and the motion of 3 August 1983 be adjourned to 15 September 1983 at 9:30 a.m. IN THE FEDERAL COURT NEW SOUTH WALES DISTRICT RECT GENERAL DIVISTON aQ oO ie ies rt Q ie] ha by tv ty a u OF AUSTRALTI: " aur. ig es? ~ ew NOVASONIC CORPORATION pry. LI MITED Applicant (AUSTRALASTI. 3.4. esocrcent the cetermination of in &@ mome tO appear applicant nl June in the Supreme C = Corsoration Pty. Limited trading as 41-2 Cicy ul a (Bb yy uw ct Go Ns w 0) a rs fo PB '3 oh Su a) Ww bet ow kg wo "5 we ia n a ry fo I fo wn i fo ne) ey St rom orocesaing further with actzon No 3903 of ourt cf New South Wales, ESqurty Division vending certain scrocescings in this Court to which fF nz. Court action was commenced on 5 November 1982 by ed trading as Frengh= Management International, ¥, sought te wind us the anplicant. In December gave notice in the Suprere Toart action that it anc §9 Surpert 72 ump une 1993 the Master in Equitt vas informed that che nN Mayne Nicxless claim against the applicant hac Deen satisfied as itt that 16 was the respondent's intention tc apply to be substituted as plaintiff in the winding up action. Counsel appearing for the applicant informed the Master that such appiic-cion wouid be opposed. The matter was then adjourned by che Master ts TC Cune 1982. E:rce then the matter has been adicusnecd from cima to time and oresentiy stands adjourned until 30 August 1983. On 7 January 1983 the apolacant commenced oroceedings in this Court by frling an application and statement of ciaim seeking camages a Practices Act, 1n particular ss. 46, 47 and 48, Directions wers given, by consent, by this Court on 18 February 196? for the seexing and furnishing of particulars, the filing oF a defence by the respondent and discovery and interrogatories. Those directions were varzed by consent on 3 June 1983. Other directions were given on 10 Aucust 1993. FPuctnerc and setter Particulars of the statement of claim were sougnt and furnished. A defence was filed by the resvondent A list oF Jocurents was filed by the applicant on li August 1987, Fut tne sreseendent disputes its completeness. On 3 August 1983 the aoslicant 'Filed the orice oF ty a rt A a a ty a) M1 =] scl xt 4? is pS rey ution as ra ew sti sub for st .ses its applicatio fot bd icant c to the app respondent of the sale by the ut arises 0 action, wm a) al oe) w the applicant estimates ohy a at Wy) Sh 4) WD cy i} bd 4. restraining order. One of the submissions advanced by counsel Ice phe soplicant is that in cases such az the cone st hand, urder che . of associateé jurisdiction, jurisdiccien is cenferred on this Court exclusive of tne Suprema Court-with cescect, net only to the claim ios damages under 5s. 82 (which is exclusively within this Courcz's jurisdiction), but aiso to the winding up action in the Suoreme Court Reference was made to various cases, including the judgment of th digh Court in Fencotz v. Muller 57 A.L.J.R. Vv. Coast Securities (Neo. 9) Perv. Exmiced & juderent cf another Cudde of this Court delivered on 23 March 15983. Stack''s cas2 has heen rcemovyed to the High Court pursuant tos. ¢0 of the Judiciary Acer. TI am unformed that argument has concluded before judgment 1s reserved. It was not disp judgment of the Hich Court in Stack's ca way or another the correctness oF the submission exclusive jurisdiction to hear and Geterrane, "ict onlvr 'the s. 22 claim, but also the winding up action in the Supreme Court. ct In these circumstances the motion voraoceeded befor2 ne or the basis of an application for urgent celraf of an interzm natures pursuant to sub-s. 78B(5) of the Judzs2acy Acct 22 was agreed that directions should be given to the avsiitcant <9 give the ~scessarv netices to the Attorneys-General of the Commonweaith and Mew South Wales oursuant to that section. That ths argument as to cth2s Cturt having exclusive jurisdicticn tc heas arcades 3. it and the winding up action in the Susreme Court is Fairly oven. Wnen argument will praoabiy be 'smcwn. af it 18 a corssct arqure nt che acolicant's case for an order restraining the respondent frem eroceeding further with the Supreme Court action music be strong indeed. In my view this consideration suoports the app the order sought in the motion, at least until the Nigh Court jucgment in Stack's case is known. However, there are cther considerations which susport the qeanting of the order soughz. TRe adplicant si.bTits tast in the a) @ tw a IH H im | Ie Hi at ty ad a i) Oo io ts a cr i) ta Cc 'S aa} oO 's ctfa) oO fu wv ray wo Vs cro a ix oy cr ¢l a (h a fh A t a is 'Q c ay pw n ct H ry "5 un tyQ fo ra or o w f dec ly iy pu "3d 1)p. bq et t > n oD ut ® ® Ha iy ct nu0 rh a Yr (D u w N claim. ff the avoplicant succeeds ian that 5s. 22 clazm and recovers an amount of damages 2m axcess of the amount oF the rcesve-dent's lawl claim against 1t, various possibilitias may arise. The respondent may mot then be a creditor of the avvlicant of, .£ a creditor, may not be envitled to proceed to a winding up may not be entitled to the Senefit of any voresumpticn oF the applicant's insolvency flowing from non-com up of the apslicant unless the 5s. 32 clai~ is detesmired against the aoplicant; or, 12 determined in its Favour, in an the amount oroved by the sesvconaent. on the respondent and its status in the Susreme Court woulé be occasioned by any successful clain under s applicant, but nothing turns on this, and certasnly it for me to attempt to resolve it. As the s. 82 claim can be deternined scnly by seems to te thar the aunterests of justice szoint restranning the respondent from oxsroecesding further in respondent would not in my view be orejudiced by this c true that it cannot in the msantime proceed with the action, but it is @zffrcult to see how that action can final hearing without this Court first determining th claim foc damages under s. 82. Io have no view cl the weaknesses of the s. 8Z claim, but it was not suggested b The Court can énsure oy asoropriatse directi applicant diligently prosecutes 1%~s claim in this Court. restrain the respondent from proceeding further in the ct cr a wo Lt wo a Pp lea Aa b w ity wD "5 ct SS or QO action until further crder, bu 's motien fer a vrestcaining ordes to restore the applicant - #25 does no this Co iD iy th w oO it cr ' H iy a Tt) , 7. Ioow2ril net circumserise motion back in the list, but the are circumstances which vould inc th o injunction. prosecute its s. any attempt by 2 winding up action during the of any steo in notice to the res 82 claim with all due diizgence and exsedition, or t to seek from the Supreme Court The orders of the Court are as Scllows:- 1. That the cespondent be restrainec until order fron seeking co) 6©6bS)0 6Supstzctuted as the plaintiff® in action 3°00 of 1982 in the Suprene Court of New South wales Equity Divisien or otherwise oroceedang further with such action. 2. That each party de at liberty <co restore to the list on two days 3 August 1983 and the asplication for s. 82. p) or ' {2 w 'Ss oO uiie) rs ty m al py ay 0) between anc on the Attorneys-General cf tne Cammonwesalthn and New Scuth Wales a notice of aA constituticnal matter which shail comoly with sub-rules Ie u fy pe] A a,bs a > n Pp ny ~~ an (1ii) of Order 51 mutatis mutand state the date to which this matter is to be adjourned 5. The applicant shalt file an affidavit st tine service of the said notices an or hefore Wednesday 7 September 19983. wu apolicatien are wo adjourned to 15 Sevtember 1983 at 9:30 a.m. (Discussion then ensued between the Bench and counsel' Following the counsel and should be made. ~ I note the undertaking to the Court giver by the avclicant through its counsel that it will mst ake any aoDlicactior <ic¢ the Suvreme Court cof Mew South Hales, Eounty Divisiit in geticon No. 29tt of 1982, Equity Division witheur 7 darvs crior notice cf 1is intention > "Noa _ 1 9. to make such an aprplicaticn having been given in writing tc the respordent. I direct that all axnz>2 except Exhibit 3, may be handed and that in th meantime either party may mexe covies of those exhibits. Exhibit 3 is to be returned tc the Supreme Court of New South Hales <teday. The documerts croduced in responses to rusecenas ney ke sstucnec after Necresdéday 22 August L2at, and in tine may make iceles of the docurencts st orctiurei The costs cf the two motions to set To dealt with yesterday will be the resrond Gd oF 1983 ! certify that this and the freasons for Judgment herein of his Honour ht Justica Lockhart. i . ye Odea Cf he. Assocrate preceding pages are a true copy of the