FEDERAL COURT OF AUSTRALIA Hardcastle v Advanced Mining Technologies Pty Ltd [2001] FCA 1854 PHILIP JULIAN HARDCASTLE v ADVANCED MINING TECHNOLOGIES PTY LTD & ORS N 923 of 2001 EMMETT J 14 DECEMBER 2001 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 923 OF 2001 BETWEEN: PHILIP JULIAN HARDCASTLE APPLICANT AND: ADVANCED MINING TECHNOLOGIES PTY LTD ACN 060 418 859 FIRST RESPONDENT HENDRIKUS THEODORUS VERHOEF SECOND RESPONDENT THOMAS BAINES GILPIN THIRD RESPONDENT JUDGE: EMMETT J DATE OF ORDER: 14 DECEMBER 2001 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The application be dismissed. 2. The applicant pay the respondents' costs of the proceeding. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 923 OF 2001 BETWEEN: PHILIP JULIAN HARDCASTLE APPLICANT AND: ADVANCED MINING TECHNOLOGIES PTY LTD ACN 060 418 859 FIRST RESPONDENT HENDRIKUS THEODORUS VERHOEF SECOND RESPONDENT THOMAS BAINES GILPIN THIRD RESPONDENT JUDGE: EMMETT J DATE: 14 DECEMBER 2001 PLACE: SYDNEY REASONS FOR JUDGMENT 1 I have before me, a motion for a summary dismissal of a proceeding brought by the respondents, Advanced Mining Technologies Pty Limited, Hendrikus Theodorus Verhoef and Thomas Baines Giplin. An amended statement of claim has been filed pursuant to leave that I granted on 10 September 2001 . The notice of motion is directed to the amended statement of claim. 2 The amended statement of claim alleges causes of action in fraud and unjust enrichment. On the face of the pleading, there is no federal element at all that would give this Court jurisdiction to entertain the claims. The claims are made against the second and third respondents on the basis of alleged misrepresentations, made prior to the entry into of agreements by the applicant, relating to shares in the first respondent. 3 The applicant appears in person. When the applicant was asked to identify the Court's jurisdiction, he referred to the Corporations Act 1989 (Cth). Under s 1337B of the Corporations Act 2001 (Cth) ("the Act"), jurisdiction is conferred on the Federal Court of Australia with respect to civil matters arising under the Corporations legislation. The applicant referred to s 185 of the Act which provides: "Sections 180 to 184: (a) have effect in addition to, and not in derogation of, any rule of law relating to the duty of liability of a person because of their office or employment in relation to a corporation; and (b) do not prevent the commencement of civil proceedings for a breach of duty or in respect of such a liability referred to in paragraph (a). … … … … … … …" Sections 180 to 184 are concerned with the duties of directors: · to act diligently, · to act in good faith, · not to use the position to gain an advantage or cause detriment to their corporation, · not to use information to gain an advantage and not to act recklessly or intentionally dishonestly. 4 The essence of the claims made in the statement of claim might be summarised as follows: · At a meeting in about late May 1999, attended by the applicant, statements were made by Mr Cecil Levy concerning the first respondent ("AMT"). · The second and third respondents, who were directors of AMT, confirmed that the statements made by Mr Levy were an accurate account of AMT. · Those statements were false to the knowledge of the second and third respondents. · The applicant entered into various transactions on 2 July 1999 involving a transfer of shares in AMT. · Those transactions were induced by the false statements made by the second and third respondents and they intended that effect to follow. If such allegations were made out, then it is possible that there would be a proper cause of action in fraud or deceit shown by the statement of claim in its present form. However, it is by no means clear that all of those allegations are made, although the substance of them may possibly be found in the current pleading. 5 At present, the applicant is not able to indicate whether he does wish to make further amendments in order to rely on ss 180 to 184 of the Act. If he did so, it may be that this Court would then have jurisdiction to entertain the fraud claim that is presently made. In the absence of any such cause of action, however, this Court does not have jurisdiction to entertain the application. In its present form, it is beyond the jurisdiction of the Court. As such, it should be dismissed as incompetent. 6 It is clear that the statement of claim requires further amendment. It may then be appropriate for the Court to transfer the proceeding to the Supreme Court of NSW. I indicated on an earlier occasion that the applicant would not be given further opportunity to re-plead, although such an indication is not determinative. The applicant was exempted from paying filing fees in respect of the current proceeding and, accordingly, if I were to dismiss it, the applicant would not be prejudiced, even if he then chose to commence fresh proceedings in the Supreme Court. 7 In all the circumstances, in the absence of any assurance from the applicant that he wishes to rely on a cause of action arising under the Act, I consider the appropriate course is to dismiss the proceeding. I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett. Associate: Dated: 15 January 2002 Counsel for the Applicant: The applicant appears in person Counsel for the Respondents: Mr P Clay Solicitor for the Respondents: Musgrave Peach Date of Hearing: 14 December 2001 Date of Judgment: 14 December 2001