FEDERAL COURT OF AUSTRALIA Garrett v Foster's Wine Estates Limited [2007] FCA 253 PRACTICE AND PROCEDURE – setting aside originating process – O 9 r 7 Federal Court Rules – no standing to seek the relief sought Federal Court of Australia Act 1976 (Cth) s 31A Bankruptcy Act 1966 (Cth) s 58 Corporations Act 2001 (Cth) s 206B(3), s 601AB Federal Court Rules O 9 r 7, O 20 r 2 In the Estate of William Just, deceased (No 1) (1973) SASR 508 cited Evajade Pty Ltd v National Australia Bank (No 2) (2005) SASC 229 cited Ford and Lee, Principles of the Law of Trusts (Thomson Law Book Co, 2006) ANDREW MORTON GARRETT v FOSTER'S WINE ESTATES LIMITED, SUNTORY AUSTRALIA LIMITED, THE ANDREW GARRETT GROUP (PREVIOUSLY TRADING AS THE WINE COMPANY PTY LTD) AND CELLARMASTERS WINES PTY LTD No SAD 12 of 2007 FINN J 2 March 2007 ADELAIDE IN THE FEDERAL COURT OF AUSTRALIA SOUTH AUSTRALIA DISTRICT REGISTRY SAD 12 OF 2007 BETWEEN: ANDREW MORTON GARRETT Applicant AND: FOSTER'S WINE ESTATES LIMITED First Respondent SUNTORY AUSTRALIA LIMITED Second Respondent THE ANDREW GARRETT GROUP (PREVIOUSLY TRADING AS THE WINE COMPANY PTY LTD) Third Respondent CELLARMASTERS WINES PTY LTD Fourth Respondent JUDGE: FINN J DATE OF ORDER: 2 MARCH 2007 WHERE MADE: ADELAIDE THE COURT ORDERS THAT: 1. The originating process in this matter be set aside. 2. The applicant personally pay the first and fourth respondents' costs of the motion. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA SOUTH AUSTRALIA DISTRICT REGISTRY SAD 12 OF 2007 BETWEEN: ANDREW MORTON GARRETT Applicant AND: FOSTER'S WINE ESTATES LIMITED First Respondent SUNTORY AUSTRALIA LIMITED Second Respondent THE ANDREW GARRETT GROUP (PREVIOUSLY TRADING AS THE WINE COMPANY PTY LTD) Third Respondent CELLARMASTERS WINES PTY LTD Fourth Respondent JUDGE: FINN J DATE: 2 MARCH 2007 PLACE: ADELAIDE REASONS FOR JUDGMENT 1 Despite the mountains of material sought to be filed by the applicant, an unrepresented but experienced litigant, for the purposes of the motion presently before me, the issue to be determined falls within a very small compass indeed. 2 The applicant, Andrew Morton Garrett, purporting to act in quite a number of different capacities, instituted proceedings against the four respondents on 24 January 2007. The first respondent, the proper name of which is Beringer Blass Wine Estates Ltd (it formerly having been Foster's Wine Estates Pty Ltd and before that Mildara Blass Ltd in yet an earlier incarnation) is, with the fourth respondent Cellarmasters Pty Ltd, a company within Foster's Brewing Group Limited's family of companies. These two companies have moved to have the Application and Statement of Claim insofar as they relate to them set aside under O 9 r 7(1)(a) of the Federal Court Rules. In the alternative, they seek summary judgment in their favour in relation to the whole of the proceedings under s 31A of the Federal Court of Australia Act 1976 (Cth) or else that the proceedings be dismissed or stayed insofar as they relate to them under O 20 r 2 of the Federal Court Rules. THE APPLICANT IN THE PROCEEDINGS 3 Mr Garrett purports to bring these proceedings in a number of capacities. The first is in his own right. To the extent that he seeks to assert causes of action belonging to him beneficially, the proceedings are incompetent. Mr Garrett was adjudged bankrupt on 24 September 2004 and any cause of action he possessed other than as a trustee vested in his trustee in bankruptcy pursuant to s 58 of the Bankruptcy Act 1966 (Cth). I would merely note that there are some allegations in the Statement of Claim suggesting possible wrongs to him personally. It is unnecessary that I seek to unravel them from the general allegations made. 4 Secondly, he purports to sue as "managing trustee" of 26 trusts. It is unnecessary for me to consider whether or not Mr Garrett can properly appear for these trusts in the representative capacity he asserts. I would simply note, though, on the material before me and by Mr Garrett's own admission, the first two of the trusts listed are ones in respect of which he is a joint trustee along with a company, Evajade Pty Ltd. It would appear from a printout from the Australian Securities and Investment Commission's national database that that company has no current directors and that it has a sole shareholder who has entered into a personal insolvency agreement under Pt X of the Bankruptcy Act. I would note in passing that that printout is proof of its contents in this regard in the absence of evidence to the contrary. The difficulties this may pose need not be explored here: cf In the Estate of William Just, deceased (No 1) (1973) 7 SASR 508; Ford and Lee, Principles of the Law of Trusts [9380]. 5 Thirdly, he asserts to be sole director and shareholder (albeit in the capacity as a trustee) of 15 companies. As to the claim that he was sole director, he admitted under questioning that he was not now a director, his attention having been drawn to the provisions of s 206B(3) of the Corporations Act 2001 (Cth) and to the problems that section might cause him. They were also pointed out to him in turn by Gray J in Evajade Pty Ltd v National Australia Bank (No 2) (2005) SASC 229. Curiously two of the companies of which he asserts to be director and shareholder are Evajade Pty Ltd and the third respondent in this proceeding, The Wine Company Pty Ltd (the previous name of which was Andrew Garrett Group Pty Ltd). I have referred above to Evajade. As to The Wine Company, the ASIC national database printout reveals that company to have been de-registered on 15 January 2006 by ASIC pursuant to s 601AB of the Corporations Act 2001 (Cth). I need to emphasise this for reasons which will become apparent below. 6 Fourthly, he purports to proceed as assignee of causes of action including from the de-registered Wine Company. What is not clear is in what capacity he is acting as assignee or what those choses are. 7 Fifthly, he purports to be exercising powers of attorney on behalf of some number of persons and companies including his wife who is also an undischarged bankrupt. There is no evidence as to the type of cause of action vested in her which he is prosecuting on her behalf, let alone whether it is competent for her to assert it. 8 I mention all these capacities for two reasons. The first is that the manner in which he has pleaded them in his Statement of Claim gives grave reason for pause as to the accuracy and the competence of the representative characters he asserts for the purpose of this proceeding. The second reason I refer to them is as to point out that in any of the capacities on which he purports to rely, it would not be competent for him to obtain the relief he seeks. I now turn to this matter. THE APPLICATION 9 The Application is an unrevealing document which appears to seek relief against only Foster's Wine Estates and Suntory Australia (an ASIC search does not reveal a company registered with this name). Nonetheless, the Statement of Claim seeks the following principal relief against either the first or fourth respondents: "1. That an order be made setting aside the agreement dated 1995 between Cellarmasters Wines Pty Ltd, The Wine Company Pty Ltd and Suntory Australia Pty Ltd. 2. That an order be made that Cellarmasters Wines Pty Ltd pay to The Wine Company Pty Ltd all Gross Margin generated by the brands set out in paragraph 26.1 and subject to the agreement referred to in Paragraph 31. 3. That an order be made that Cellarmasters Wines Pty Ltd pay damages to the Wine Company Pty Ltd. 4. That an order be made setting aside the sale agreement dated January 1995 between the Wine Company Pty Ltd, Suntory Australia Limited and Mildara Blass Limited (Fosters Wine Estates Limited). 5. That an order be made that Fosters Wine Estates Ltd pay the Wine Company Pty Ltd the Gross Margin generated by the assets subject to that agreement in the period from January 1995 until the date of setting aside of that agreement less the payments that would otherwise have been due under the Garrett Family Licence and the implied License to trade as Andrew Garrett Wines. 6. That an order be made that Fosters Wine Estates pay to Andrew Morton Garrett ©® in his capacity as Trustee of the Andrew Garrett Family Trust No 3 the moneys that would have been due under the Garrett Family License and the implied License to trade as Andrew Garrett Wines in the period from January 1995 until the date of setting aside of that agreement. 7. That an order be made to preserve the Status Quo and prevent Fosters Wine Estates Limited from dealing with the assets set out in orders 1 & 3." 10 What is clear from the orders so sought is Mr Garrett, in any of the representative capacities, is not competent to prosecute claims for such relief. In relation to order 1 the court is being asked to set aside, at Mr Garrett's suit (in one of his myriad of capacities), an agreement to which he is a stranger. He clearly is not a party to the agreement nor is he the surrogate of any such party. More significantly there is no evidence of this agreement and it is not referred to in the Statement of Claim. I would reiterate that The Wine Company – of which Mr Garrett claims to be a shareholder (but only as a trustee despite the notation to the contrary in the ASIC company extract) – is de-registered. 11 The second order suffers the same vice in that Mr Garrett in all of his capacities is simply a stranger to any claim The Wine Company may have against Cellarmasters Wines Pty Ltd. I would add that the Statement of Claim does purport to spell out a wrong or wrongs committed by Cellarmasters to the detriment of The Wine Company. Those wrongs are in the main of a particularly serious character, e.g. a fraud and a breach of the Commonwealth Criminal Code, without adequate pleading of them. It is improper for him to have made these allegations in the way he has. 12 The third order sought is subject to the same vice as the previous two. I need say no more. 13 The fourth order is to set aside a sale agreement entered into on 19 January 1995 in which The Wine Company and two subsidiaries of it agreed to sell and Mildara Blass Ltd agreed to purchase the assets of The Wine Company's business. It is unnecessary to go into that agreement in any detail other than to indicate that Mr Garrett in any of his capacities is not a party to that agreement. He has no standing to bring proceedings to have it set aside. 14 Orders 5 and 6 relate to claims made consequent upon the setting aside of the agreement in order 4. Being dependent orders they must fail because of the vice in the claim for relief in order 4. 15 In the course of today's hearing Mr Garrett indicated that the preservation order which he seeks by way of interlocutory relief was related to the assets the subject of the sale in order 4. It likewise is not an order that is competent for him to seek in these proceedings. 16 The matter is one in which it is appropriate for me to exercise the power that I have under O 9 r 7 to set aside the originating process as it relates to the first and fourth respondent. I do so, I emphasise, on the ground that Mr Garrett simply does not have standing to seek the relief sought in the proceedings. 17 Having taken this course, I would not wish it to be thought that his Statement of Claim is not otherwise unobjectionable. The contrary is the case. It is an embarrassing document replete with grave assertions against persons and entities whether or not parties to the proceedings. It does not in any way properly reveal the basis upon which complaints were made. It simply asserts wrong doing. Additionally, I have already commented upon my concerns about the various capacities in which Mr Garrett purports to be making his claims. I can only suggest that if Mr Garrett is minded to institute further proceedings in this court (he has a considerable number running at the moment), he is likely to find documents cast in the form of his Statement of Claim in this matter are found to be quite objectionable. 18 What appears to underlie Mr Garrett's complaints is his sense that the respondents (other than The Wine Company) have acted individually and in concert (hence the conspiracy allegations) to oppress the "Garrett Interests", a description unexplained in the Statement of Claim. Illustrative of how he expresses his grievance is the following attack made on Suntory in respect of dealings between himself, a Garrett family trust, a Garrett company or companies and Suntory in the early 1990s in para 27.15 of the Statement of Claim: "27.15.1 Breached the transaction agreement 27.15.2 Breached the consultancy agreement 27.15.3 Breached the shareholders agreement 27.15.4 Engaged in conduct that is misleading or deceptive in that it has claimed to have entitlements to assets that did not exist, in contravention of S.12DA of the ASIC Act. 27.15.5 Engaged in conduct by which it had made a false or misleading statement concerning the existence or effect of a right or remedy in contravention of S.12DB(1)(g) of the ASIC Act. 27.15.6 Engaged in conduct that is unconscionable with the meaning and in contravention of S.12CA or alternatively either S.12CB or S.12CC of the ASIC Act. 27.15.7 Contravened S.52 and/or alternatively S.53 of the TPA (1974). 27.15.8 Engaged in conduct that was unconscionable at general law. 27.15.9 acted for unjust enrichment to the detriment of the Garrett Interests for their own benefit 27.15.10 acted without Clean hands 27.15.11 acted in breaching Trade Practices Revision Act 1986 No 17 of 1986-section 22 27.15.12 acted in breaching the Criminal Law Consolidation Act (1935) at sections 19, 131, 142, 5.G(d), 133(2), 171, 172 270(1)(c), 270(2), schedule 3.10 27.15.13 acted oppressively 27.15.14 Committed an act of Fraud at General Law. 27.15.15 Breached the Duty of Care owed to the parties 27.15.16 Breach of the Constitutional Rights of Garrett Interests 27.15.17 sought to oppress the Garrett Interests. 27.15.18 Acted unconscionably 27.15.19 Acted for unjust enrichment 27.15.20 Acted oppressively and conspired to breach section 2.E, 2.F & 2.G of the Corporations Act (2001) also section 260E 27.15.21 Intended to conspire to defraud the beneficiaries of the Andrew Garrett Family trust at Common Law. 27.15.22 Breach of Contract Law. 27.15.23 Breach of the maxims of Law in respect of Equity 27.15.24 Breach of Trust 27.15.25 Breach of the Transaction Agreement 27.15.26 Breach of the Crimes Act (1914) at Parts 3AA, 3B, 27.15.27 Breach of the Criminal Code Act (1995) Divisions 4.1, 5.1-5.4 11.1-11.5, 12.1-12.3, 131-137, made unwarranted demands at Division 138, breached division 480 27.15.28 Breach of the Laws of Australia" The vices in pleading in this fashion are glaring. Mr Garrett has brought enough proceedings in courts in various parts of the country and ought to know better. 19 Lest it be thought that I have overlooked a particular matter, Mr Garrett accepted during the course of the hearings before me that a Deed of Settlement he, amongst others, entered into with Mildara Blass Ltd on 26 July 2000 which was to be the final resolution of difficulties between, inter alia, Mr Garrett and Mildara Blass is not in issue in these proceedings. This notwithstanding significant reference is made to it in the Statement of Claim and he indicated in his affidavit of 25 January 2007 that action taken by Mildara Blass in relation to that Deed of Settlement (with the leave of the Supreme Court of Victoria), caused him to make the present application. Much in the documentation he has put on seeks impermissibly, but irrelevantly for present purposes, to attack collaterally the leave given in the Supreme Court of Victoria. 20 Though the present motion has been brought by only two of the four respondents, I will of my own motion set aside the application against all respondents and not merely the moving parties. Though this is hardly necessary – the second named respondent seems to be a non-existent company; the third, a de-registered company – I do so because the application in its entirety is incompetent. 21 I will order that the originating process in this matter be set aside. I order Mr Garrett personally to pay the first and fourth respondents' costs of the motion. I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn. Associate: Dated: 2 March 2007 Counsel for the Applicant: The Applicant appeared in person. Counsel for the Respondent: Mr M C Livesey QC with Mr B C Roberts Solicitor for the Respondent: Kelly & Co Date of Hearing: 28 February 2007 Date of Judgment: 2 March 2007