JUDGE MAKING CRDER DATE OF GRDER WHERE MADE THE COURT ORDESS: i. That the order made restraining the seeking action No. BETWEEN: Lockhart J. 27 October. 1983 Sydney by the respondent to be substitute South Wales Equity Division further with such action NOVASONIC HAGEMEYVER i) oy a HH, be oO ify ty CORPORATION PTY. LIMITED (AUSTPALASIA . Court on 26 Aucust 1983 ivom until] furtner order a as the piaintiff in Ga. tu The apolicant be veleased frem 1255 uncertaking @Qiven to tae Court on Z¢ August 1325 tnat it will mot make any application to tne Supreme Court of New South Waies Equity Division in action Ne. 3900 of 1982 Equity Divisicn without seven cays prior notice of 10s intention to make such an application having been given in writing to the ressondent. The costs of the application to terminate the injunction granted on 26 August i983 be tne respondent's costs in the proceedings in this Court No. G4 of 1983. oN THE FEDERAL COCUPT OF AUSTRAL NEW SOUTH W i Oy ft Ls) -Wet [aa] t=Hi ie Fy eal te [te h~t [on] Hy rd hed = o G? af fe) LayiG ta GENERAL DIVISION BETWEEN : NOVASONTC CORPORATION PITY. LIMITED Applicant AND: HAGEMEVER (AUSTHALASTA) B.V. LOCKHART J. 27 Octoper, 15383 REASONS FOR JUDGMENT LOCKHART J: On 26 August 1983 the Court granted interlocutory tonjunctions restraining the respondent, Hagemeyer 'Australasia) 2.V., until further order from seeking to be substituted as plaintiff in action No. 3900 of 1982 in the Supreme Court of New South Wales Equity Division, or otherwise proceeding further with such action. liberty was given to each party to restore the matter to the iist on two davs notice. An undertaking was given to the Court br the arpliicant, by its counsel, that it would nov make any appizcation to tae Supreme Court 2m action No. 3900 of i982 without seven cays werisy neotise of 2ts intention te maxe such applicaticn having seen given in writing tc Int The respondent has rvestered the matter tc tne list and now seexs an order tnat the injunction be terminatea. Most of the relevant facts are set forth inmy earlier reasons for jiuagment, sce I need not rereat them. The earlier application proceéced before me on the basis cf an application tor urgent relief of an interim mature pursuant to sub-s. 785(5) sof the dudiczary Act 1903 because the requisite notices haa not >esn yiven to the Attorney-General cf the Commonwealtn anc tne Atrtornsy-Generai of the State of New South Wales pursuant to s. 78B. The principal submission cf ceounsei for the sasrlicant in th earlier hearing was that jurisdictron is conferred on tnis Court exciusive of the Supreme Court with respect, not only to the claim for damages under s. 32 of the Irade Practices Act. which admzttedly is exclusively within this Court's jurisdiction, but aiso to the winding up action in the-Supreme Court. I said: "Reference was made to varicus cases. including the judgment of the High Court in Fencott v. Muiler $7 A.L.J.R. 317 and Stack v. Coast Securities No. %) Ptv. Limited a judament of another Judge of ct Court Geliverea on 23 March i983. Stacz s case has been removed to the High Court oursuant to 3. 40 cf the Judiciary Act. loam antoymead that ar ent nas concluded before the High Court and that mrent 25 reserved. it was not disputec ov the parties mnat tne quderen oz the High Ccurt in Stace s case will probably determine one way sr anctner tne corractness cer tne submission that this Ccurct kas exclusive jurisdiction to hear ana cetermine. net oniy tne =. 82 claim, but also the winaing ur acticr in = Supreme Couct. Tn these circumstances the motion eq beicre me cn the basis of an apolication for relief sof an interin nature sursuant Tc sub-s. 5) 35 wne duaiczary Act. It was agreed tnat aire Bhouli2a 3¢ given tl the applicant <2 give the nece v7 notices to the Atrtorneys-Generai of the Commenwealth anc New South Wales pursuant to that section. It is plain tnat tne argument as to this Ccurt heaving exclusive jurisdiction to hear tne damages clarm under s. 42 ana the winding up actzon in the Supreme Court is falriy open. When the Hich Court gives its judgment ain Stack 5s case tne fate or that argument will probably be known. If zt is a corre argument the applicant's cas¢ for an orcec restraining the respondent from eroceeding further with the Supreme Court action must be strong indeed. In my view this consideraticn supports the appizcation fcr the order soudqht in the motion, at ieast until the Hign Court Juagsment in Stack s case is x"ncwn.' Later I said: "As the s. 82 claim can be determined oniy py this Court it seems to me that the interests cf justice point strongiy to restraining 'tne respondent from eroceeaing furtner in.the Supreme Court act2cn at Léast until the resuit of Stack's case 15 "nown. Stack's case (I use this description for ccenvenience, Dut it refers both to Stack v. Coast Securities 'No. 9) Ptv. Limited and Bargai Lamited v. Force) was decided by the dHign Court on 12 October 1983. after my earlier judament in this matter and after the hearing of the appliction to terminate the intericcutory injunction. If subsequently invited counsel to make any further submissions about the effect of Stack's case on this application, further submissions were necessary, their 1n disputed before me at the earlier High Court in Stack's case woulc oropanly ae the correctness of tne Ffrinciral submis applicsant, that assumption was strongly cna respondent when the matter came but they Vi ew. toid me that no Aithough it was not The Jucgment cof the 2 2ne wav of another or ccunséi Foy tne ao ov counsel iis the to Teetinate the mnteriscutory injunction. The arqument. in summary, was wnat at its Mignest for che applicant Stack s case would only sfusrert a TFindaing that this Court has exclusive jurisdiction to iaestermine tne question whether the applicant is indebted to the resnoncent in ine amount in dispute namely, approximately £100,000. The respondent claims tnat the applicant owes it something in the order of $270,900 - 3284,000. submitted that on no view could this Court itseif >3draer sither that the applicant Se wound up cr that the Suereme Court sf New Scutn wales shouid make that order. The judgment of the High Court in Stack case 15 not authority for the proposition that the Court has exclusive or o ct ro qurzsdiction to determine the non-feceral asvect cf th m cversy petween the parties namely. the question of the iundentedness of the applicant to the respondent. Still less does 1t support the view that this Court has jurisdiction to wind up the applicant. "Tre Court" under the Companies (New South 'Wales, Code means the Supreme Court of New South Wales. This definition is not sufficientiy tractabie to be yead as including the Federal Court. Also 1t must pe rememberea That the Companzes (New South Wales) Code <5 part of tne Commonwealth' Stare scheme for the requiation of companies and the securities incustry. It is 4 scheme which came iuntc operation Fcllcwing extensive Giscussions between the Commonwealth anc ine States where the States nave a recognised role to verforn with vescect, arcngst tiner things, to the winding up of companies througn theirs Sucrceme Crurts., If weula be antithetic to the erincipnies inherent in the Commornvealthsstate scheme that this Court could itself dairect that a corcany re veund ur under the orovisions of the Comsanres 'New Foutn Wales Uode. I veferred +2 che Commcenweaitn,State scheme Fer the leqg.latiin st tne News Corcoratzion & Ors. v. WNationai Companies ana securitiss Commission judgment given 3 June 1383 and ngec not repeat wnat I said ' Even if this Court could determine the nature and extent of the indebtedness of the applicant to the resvondent on its running account, whicn is the fcundation cof the respondent s right to seek an oraey winding up the applicant 'an' the Supreme Court, 1 does not follow that this Court can put an end to that dispute between the nt. ~hat can pe daone a fp ty ut fu res by ordering the winding up of the arpiic oniv by the Supreme Court of New South Wales. The advantage of allowing the injunction to continue 1s that 1t would enable the parties to have determined in the one Ccurct 'this Court) both the applicant's claim for damages under s. 82 of the Trade Practices Act. which this. Court alone has jurisdiction to hear, and the question of the extent of the indebtedness of the applicant to the respondent on the former running account between them. The applicant concedes that it owes the respondent on cnat acccunt $124,919, tn dispute peing as to the palance of ancurt 3.00, 9C. Fut this iiscute 1S mot properly raised by the pieadings in tneie rrerent Torn. amended statement of claim in the s. 82 ercc2edings alleges as Isllcws in paras. 13 to 22 2znclusive: 5. '13. At tne time of such or ystusal to supoliy there was s¢ cayanle pursuant to tne sun reiotc in caragraon 7A of the f1 20. The Peseondent claims that such amount was, ana is, $274,247.51 and, claiming to be a creaitcr in char ; amount, sgexs to be substituted as riaintili in Proceeainags No. 39¢0 of 1982 in the Zauity Division or che Supreme Court of New Ssuth Wales for the winding us of the Applicant herein. _Zi. The Applicant alleges that the amcunt "otherwise payable pursuant to the said running accsunt is the sum of si24,000.00. 22. In tne premises the Apvlicant 1S entitled to set off against whatever sum 1s ctherwise vsayanle pursuant to the said sunning: acccun tne anmcunt founa by th2s nmonourablie Court to be the ramage sustained by the Applicant pursuant to paragraph 18 of the Statement of Claim." The applicant claims in its amended statement oz ciaim, in addition to an order for damages under s.82, 'a declaration as tc the amount which after any applicable set-off 1s payable by the respondent to the applicant or by the applic . ' Counsel for the applic argument that the amended statem the question of the extent of ths ant to the respondent." ant in effect ccnceded before me in ent of claim dces not properiv raise indebtedness of the acrplicant to the yu respondent and that. a further amendment to the statement of claim would be necessary to raise the true issues petween tne parties. I will, however, approach the matter before m= on the assummticnt that tne applicant wili vout its pleadings in oraes ana raise tne i2sue cf tne extent of its indebtedness cn the former running acccunt setween the parties. | A critical matter 25 chat tne Sueceme Court actlor 1s mov simpiy a4 ecoceeding unter parties prought sy tRE resroncent against : . . ac Le tne applicant <° recover the amount sac 77 pe cue cr apcut s7254,J3¥- chose proceedings was referred ~oO iF my earlier reasons DUT zt has been brought UP to date in avidence pefore me on the appiication to terminate the unjunctien- It now appears that. net only has the company, Marantz Austraila pty- Limited, appeared as a supperting creator claiming 4 debt from the applicant of si wag swosticutes as plaintitt for Mayne Nickless Dimitza oF ig Seprember 1983. John Fairfax & sons Himited a5 aiso appeared as a creaitor claiming 4 debt of some $31,000. It appears too that the Counsel for the applicant supmictec chat, iF tne unjyunction s cerminated, the Supreme Court may examine the applican<'5 claim under 5- 82 in this Court and that 'this +S unaccestabis. T ao not acceae to that surmission- Piaznly the eniy Court trhat can agerermine the applicant's claim uncer 5- oc 1s This Court. Dut che Sacer se1ed ana generally ain the emercise of its discretion in deciding 'whether <2 wine up the applicant. But uitimatesivy tne asplicant may eursue its vights under s. 82 1n this Court. Indeed, even if the applicant 21s wound up tne liguidator may continue the claim. This Court cannot resoive the entire controversy between the parties. If it could do so then the following woras of Mascn, Brennan and Deane JJ. in Stacx''s case (at pp. 30-31) would be in pornt:- 'The first and paramount consideration in the exertise of this discretion is to doe wnat 3S xcesct in the interests orf the litigants. In this respect the Federal Court can resolve the entire contre. versy; the Supreme Court cannot do so because the second limb of s. 86 of the Act stands in its way. The court which can resolve the entire controversy nas am crvi5us advantage. Generally speaxing, its determination of ail the issues will be made more efrectively anc more expeditiously and at less expense tnan the resoiution of the controversy which depends on determinations nade by two courts in separate proceedings in which the issues are necessarily fraaqmented. Te offset this advantage offered by the Feceral Court powerful countervailing reasons need to be shown. For example, it may appear that the federal issue is raised at such a late stage in the Supreme Court prcceedings that it would be a waste of time aand lead te nesdless expense and inconvenience not to proceed to a Aearindg aun that Court. Or 1t may appear tnat the feaeral issue is so insubstantial or removed from the non-federal issues that the Supreme Court should proceed with the determination of those issues. it may even appear that the federal issue 2s Dut one of many issuss mMaKing up the entire controversy and that it is inaistinguisharcie Irom one of the non-federal issues in the sense thar the resclution c= one necessarily ieass to a reztiluticn or the other. In such a case tines Will 28 stranger ground ter allowing che acticn cc prccsed in tas Supreme Ccurt Assuming tnat the statement cr claim is amenaea tf raise 2Sfue cf the indentedness of tne vesprnsent. 7 Court could tnen aetermine tnat question a= well as the clap damages under s. $2, but the winding up of the appircant must question that remains with the Supreme Court. = cealrse thac 12 Court were aoplicant te vight of the winding-up act status or the In The al 9 Getermine the question of the resvondent it would in effect thereby aetermin respondent to be substituted as vclaintiff in ion, but that action invclves creditors generaliy the asoiicant s appizcant and .the question cf hr the circumstances I propose to terminate orders of the Court are:- By the Court on 26 August i Oo ta That the order made fal restraining the respondent until further order from seexing to be substituted as the ovlaintiff in 39090 of 13982 in the acticn Neo. Supreme Court of New South Wales Equity Division or otnerwrse croceeding further with such acticn be terminateca. The appiicant 2e sreisased frou its undertaking given to che Court on 26 Sugusct L982 trait it wall not make any applicaticn t5 the fuprene CIturt st New Soutn Wales Equity Division in action Jc. 79cu the io. notice of 1ts intention tc make such arn applisation having seen given in The costs of the injunction granted respondent's costs in No. G4 of 1983. writing to the resecondent. application to termtnale tne on 26 August 1382 be the the proceedings in this Court