FEDERAL COURT OF AUSTRALIA No TasWind Farm Group Inc v Hydro-Electric Corporation (No 1) [2014] FCA 347 Citation: No TasWind Farm Group Inc v Hydro-Electric Corporation (No 1) [2014] FCA 347 Parties: NO TASWIND FARM GROUP INC v HYDRO-ELECTRIC CORPORATION File number(s): TAD 33 of 2013 Judge(s): KERR J Date of judgment: 5 February 2014 Catchwords: PRACTICE AND PROCEDURE – application for summary judgment – no reasonable prospect of success – assignability of claim for damages under Australian Consumer Law Legislation: Associations Incorporation Act 1964 (Tas) s 13 Australian Consumer Law s 236 Federal Court of Australia Act 1976 s 31A Cases cited: Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd [2006] FCA 1352; (2006) 236 ALR 720 Campbells Cash and Carry Pty Ltd v Fostif Pty Ltd [2006] HCA 41; (2006) 229 CLR 386 Cant; Re Novaline Pty Ltd (in liq) (ACN 006 622 933) [2011] FCA 898; (2011) 282 ALR 49 Equuscorp Pty Ltd v Haxton [2012] HCA 7; (2012) 246 CLR 498 Phelps v Western Mining Corporation (1978) 33 FLR 327 Poulton v The Commonwealth (1953) 89 CLR 540 Pritchard v Racecage Pty Ltd [1997] FCA 27; (1997) 72 FCR 203 Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc (1988) 19 FCR 469 Tosich v Tasman Investment Management Ltd [2008] FCA 377; (2008) 250 ALR 274 Trendtex Trading Corp v Credit Suisse [1982] AC 679 World Series Cricket v Parish (1977) 16 ALR 181 Date of hearing: 5 February 2014 Date of last submissions: 5 February 2014 Place: Hobart Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 17 Counsel for the Applicant: Mr A Wood Solicitor for the Applicant: Mr J Walker Counsel for the Respondent: Mr D Barclay Solicitor for the Respondent: Page Seager Lawyers IN THE FEDERAL COURT OF AUSTRALIA TASMANIA DISTRICT REGISTRY GENERAL DIVISION TAD 33 of 2013 BETWEEN: NO TASWIND FARM GROUP INC Applicant AND: HYDRO-ELECTRIC CORPORATION Respondent JUDGE: KERR J DATE OF ORDER: 5 FEBRUARY 2014 WHERE MADE: HOBART THE COURT ORDERS THAT: 1. The parties bring in short minutes of orders consistent with these reasons. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA TASMANIA DISTRICT REGISTRY GENERAL DIVISION TAD 33 of 2013 BETWEEN: NO TASWIND FARM GROUP INC Applicant AND: HYDRO-ELECTRIC CORPORATION Respondent JUDGE: KERR J DATE: 5 FEBRUARY 2014 PLACE: HOBART REASONS FOR JUDGMENT 1 These proceedings arise out of the opposition, initially by individual members of the King Island community, who later formed an association, and then an incorporated association to the proposed construction of a wind farm on King Island. The applicant asserts that the Hydro-Electric Corporation has contravened the Australian Consumer Law. The Hydro-Electric Corporation does not dispute that the incorporated association No TasWind Farm Group Inc which brings these proceedings has standing to seek injunctive and declaratory relief. That matter appears well settled by what was said by Bowen CJ in World Series Cricket v Parish (1977) 16 ALR 181 at 186-187: An applicant for an injunction under [the then] s 80 need not show that a proprietary interest of his is affected, or he has suffered special damage, or indeed, that he personally has suffered any damage at all. Even where the application is brought by a rival competitor seeking redress of damage to his business caused by the allegedly unfair and illegal practices of the respondent, the application, though it vindicates or protects the private interests of the competitor, at the same time secures the public interest of consumer protection. 2 That passage was endorsed in Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc (1988) 19 FCR 469 at 474, by Lockhart, Morling and Gummow JJ. The Court in that case also approved the language of Phelps v Western Mining Corporation (1978) 33 FLR 327 at 333, in which his Honour said: The context in which the phrase [viz "any other person"] appears… does not, upon analysis, suggest, let alone justify, the conclusion that the legislature intended that the phrase be modified by the engrafting of speculative qualifications such as 'who is a consumer' or 'who is a competitor' or 'who has an interest of a type which would give him standings to institute common law civil proceedings if the conduct complained of were tortious'. 3 There is thus no issue before the court about the entitlement of the applicant to bring proceedings, subject of course to the pending application for security for costs, which has to be dealt with in due course. However, the respondent challenges the entitlement of the applicant to bring claims relying upon an assignment to it by those individuals who claim to have had statutory rights under s 236 of the Australian Consumer Law. This brings squarely into question whether a person who claims to have suffered damage because of another's misleading or deceptive conduct in trade or commerce can assign his or her right to claim damages under the Australian Consumer Law. 4 Mr Wood referred to s 13 of the Associations Incorporation Act 1964 (Tas) as a basis for there being in the hands of the incorporated association bringing these proceedings, an entitlement to the property interests that were transferred or vested in it in some manner upon the incorporation of the association. Section 13(1) provides: Upon the incorporation of an association under this Act, any personal property held by a person, in trust or otherwise, for or on behalf of the association becomes vested in the association, subject to any trust, covenant, contract, or liability affecting the property. 5 In order for a personal property to be vested in the incorporated association, it must be property held by the person in trust, or otherwise, for or on behalf of the association. My attention was drawn by counsel for the respondent to the terms of Mr Donald Geoffrey Graham's affidavit at [23] to [33]. Mr Wood took no objection as to the reception of its content although the affidavit had not been formally read in these proceedings. Those statements establish that the association was incorporated only after the Hydro-Electric Corporation indicated that it intended to proceed with its plans notwithstanding its alleged failure to secure the support of the King Island community. 6 There is nothing to justify a conclusion that the provisions of s 13 are engaged. There was simply no evidence of any personal property being held in trust or otherwise for or on behalf of the association in relation to the expenditure incurred by those who had earlier campaigned against the wind farm. I reject the applicant's submissions put forward on that basis. 7 Mr Wood then submitted that each of the persons who expended funds in relation to campaigning against the wind farm (the amounts are referred to in para 12C(v) of the amended statement of claim and are particularised to a total of $84,602) had assigned their rights to such claims to the applicant. 8 The problem with that submission is that it is in conflict with the decision of Rares J in Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd [2006] FCA 1352; (2006) 236 ALR 720 in which his Honour held – in relation to the then text of s 82 of the Trade Practices Act 1974, which is in the court's view not materially different in its expression, and is accepted by both parties to be not materially different in its expression to that that currently appears in s 236 of the Australian Consumer Law – that only a person who suffers loss or damage by the conduct done in contravention of a relevant provision of the Act can recover damages under that provision, and that his or her statutory entitlement to claim damages is not assignable. 9 What was decided by Rares J in my opinion is entirely consistent with the reasoning of the High Court in Poulton v The Commonwealth (1953) 89 CLR 540 at 602 where, in obiter remarks, Williams, Webb and Kitto JJ indicated that bare causes of action are incapable of assignment either at law or equity 10 Mr Wood however submitted that the law had developed since Poulton. In England the House of Lords liberalised the relatively strict laws of assignment of causes of action in Trendtex Trading Corp v Credit Suisse [1982] AC 679, see Lord Roskill at 702-703. The High Court of Australia has indicated a disposition towards greater liberalisation, moving the Australian court closer to the position reached by the House of Lords in Trendex: see Campbells Cash and Carry Pty Ltd v Fostif Pty Ltd [2006] HCA 41; (2006) 229 CLR 386, and Equuscorp Pty Ltd v Haxton [2012] HCA 7; (2012) 246 CLR 498. 11 Mr Wood's submissions in that respect can be accepted. However, no Australian court has yet held that a bare cause of action is now to be presumed as being capable of assignment. In issue in Campbell's Cash and Carry and Equuscorp were the degree to which various exceptions have been permitted to the general rule that bare causes of action are incapable of assignment. 12 Mr Wood invited the court by reason of the persuasive influence of those High Court cases not to follow what had been held by Rares J in Boston Commercial. If that case stood on its own Mr Wood's invitation might have been persuasive but two subsequent cases determined by judges of the Federal Court have reinforced the authority of Boston Commercial. In Tosich v Tasman Investment Management Ltd [2008] FCA 377; (2008) 250 ALR 274 Gyles J at [37]-[38] accepted that there was no support for assignability of such causes of action and that any purported assignment would be ineffective for all purposes. In Cant; Re Novaline Pty Ltd (in liq) (ACN 006 622 933) [2011] FCA 898; (2011) 282 ALR 49 whilst accepting that the High Court had recognised an exception to the prohibition of the assignment of a bare right to litigate where the assignor has a genuine commercial interest in the enforcement of a claim of another and is enforcing it for his own benefit, North J nonetheless held at [19] that: It is established that a statutory right to damages, under s 82 of the Trade Practices Act 1974 (Cth), [now the equivalent provision of the Australian Consumer Law] cannot be assigned. This is because the section does not allow for an award of damages not suffered by any party to the proceeding: Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd (2006) 236 ALR 720; 70 IPR 146; [2006] FCA 1352 at [51]; Tosich v Tasman Investment Management Ltd (2008) 250 ALR 274; [2008] FCA 377 at [37] (Tosich); Mijac Investments Pty Ltd v Graham (No 2) (2009) 72 ACSR 684; [2009] FCA 773 at [31]. 13 It was put to me by Mr Barclay that I am bound by the Full Federal Court decision Pritchard v Racecage Pty Ltd [1997] FCA 27; (1997) 72 FCR 203 to find that such an assignment is impermissible. I do not accept that submission. On its face, Pritchard is capable of being distinguished as it relates to a circumstance where the question arose as to whether an entitlement under the then Trade Practices Act would pass on death as part of an estate: see 72 FCR 203 at 218. 14 That is sufficiently distant from the issue at hand, such that the court would not treat the matter as entirely resolved by that question. 15 But this court, and all single judges of this court, are bound by rules of comity such that they would not differ from a finding of another Federal Court judge at first instance unless it appeared to them that his or her decision was plainly wrong. Given that what was held and determined by Rares J has been considered and applied by Gyles J and North J, I do not think it can be plausibly contended that the views expressed by Rares J were manifestly and plainly wrong. In any case I am not so persuaded. I intend to decide consistently with the conclusions his Honour reached. 16 I should indicate before I conclude these remarks that the papers that are on the court file presently do not adequately disclose the circumstances whereby this discussion has arisen. Originally this application was expressed as an application to strike out various parts of the pleading. That was narrowed in due course, but after discussion with the court it was plain to both parties and to the court that in truth what was in issue was whether a part of the cause of action that was being pursued was incapable of being vindicated in this court. It was urged that judgment be entered in relation to that part of the cause of action where the relief was incapable of being granted. I gave leave to Mr Barclay to file and serve an amended application to reflect that position. I am satisfied, despite the caution that is appropriate in such matters, that the applicant's claim for damages pursuant to s 236 of the Australian Consumer Law, has no reasonable prospect of success within the meaning of s 31A of the Federal Court of Australia Act 1976. 17 I order that the parties bring in short minutes of orders consistent with these reasons. I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kerr. Associate: Dated: 8 April 2014