FEDERAL COURT OF AUSTRALIA Takemoto v Moody's Investors Service Pty Limited (No 2) [2014] FCA 1406 Citation: Takemoto v Moody's Investors Service Pty Limited (No 2) [2014] FCA 1406 Appeal from: Application for leave to appeal: Takemoto v Moody's Investors Service Pty Limited [2014] FCA 1081 Parties: KAZUMI TAKEMOTO v MOODY'S INVESTORS SERVICE PTY LIMITED File number: NSD 1093 of 2014 Judge: ALLSOP CJ Date of judgment: 18 December 2014 Catchwords: PRACTICE AND PROCEDURE – whether to grant applicant leave to appeal – whether sufficient evidence to found matters pleaded - leave denied – application dismissed – no question of principle Legislation: Trade Practices Act 1974 (Cth) s 51A Cases cited: Takemoto v Moody's Investors Service Pty Limited [2014] FCA 1081 Takemoto v Moody's Investors Service Pty Limited [2014] FCA 1403 Date of hearing: 18 December 2014 Place: Sydney Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 8 Counsel for the Applicant: Mr J Berwick Solicitor for the Applicant: Craddock Murray Neumann Lawyers Counsel for the Respondent: Mr C Bova Solicitor for the Respondent: King & Wood Mallesons IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1093 of 2014 BETWEEN: KAZUMI TAKEMOTO Applicant AND: MOODY'S INVESTORS SERVICE PTY LIMITED Respondent JUDGE: ALLSOP CJ DATE OF ORDER: 18 DECEMBER 2014 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The amended application for leave to appeal be dismissed with costs. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1093 of 2014 BETWEEN: KAZUMI TAKEMOTO Applicant AND: MOODY'S INVESTORS SERVICE PTY LIMITED Respondent JUDGE: ALLSOP CJ DATE: 18 DECEMBER 2014 PLACE: SYDNEY REASONS FOR JUDGMENT THE COURT: 1 This is an application for leave to appeal against Order 3 made by the primary judge on 28 October 2014, in which the primary judge refused the applicant's interlocutory application, signed 17 September 2014. That application was one which sought to further amend the pleadings in accordance with the second further amended statement of claim annexed to the affidavit of Mr Twemlow, sworn 17 September 2014. The background to this application today is to be found in the primary judge's reasons in this matter in Takemoto v Moody's Investors Service Pty Limited [2014] FCA 1081 published on 10 October 2014 and in my ex tempore reasons in Takemoto v Moody's Investors Service Pty Limited (No 2) [2014] FCA 1403 published on 1 December 2014. 2 It is necessary, however, to repeat some matters that are essential for understanding the case. The paragraphs in the further amended statement of claim which were principally relevant to today's application were the matters and representations set out in the trade practices claim at [30] and following. This can be seen by reference to the draft further amended notice of appeal, which is attached to Mr Twemlow's affidavit of 2 December 2014 that was put on for the purposes of the argument today. The applicant's submissions that were filed remain on the file. They direct attention in particular to [101] and [105] of the reasons of the primary judge. The applicant submits that his Honour was wrong to conclude that there was no evidence to found the matters pleaded. It is necessary, therefore, to say something of those matters pleaded and the evidence said to underlie them. 3 As his Honour noted in his reasons, the draft second further amended statement of claim sought to remove all trace of the claim based on the "Career Transition Program". The second further amended statement of claim in draft form that was before his Honour had an inadequate correction of the parts of the pleading concerned with the Career Transition Program. In some part of the pleading the reference was excised, such as in paragraphs 7 and 9A, and in other parts the Career Transition Program remained as a substantive part of the draft pleading. The matter proceeded before the primary judge and before me on the basis that in reading this document, the parts of the second further amended statement of claim, in draft, which referred to the Career Transition Program would be read as benefits paid to Mr Takisawa or Mr Yamauchi, respectively. 4 The argument on the leave application focused, in particular, upon the representations under the Trade Practices Act 1974 (Cth) from [30] onwards. When one looks at the whole of the amendment, one sees that the pleader has focused the claim, and in particular, the trade practices claim, upon a representation said to be that the applicant would be paid in accordance with programs as reflected benefits payable to Mr Takisawa. When one goes to the evidence that his Honour carefully analysed in his reasons and in particular, the outline of evidence on 12 September 2014, one sees that Mr Takemoto had conversations with Mr Takisawa and Mr Yamauchi in 2003 and 2004 respectively, as to what they expected to happen in the future. Then there is a crucial meeting with Mr Keller in September 2003 which was repeated, in part, later in that year. The relevant representations were contained within paragraphs 18-28 of that outline of evidence as follows: [18] I had a meeting with Thomas Keller in the Moody's office in Tokyo in September 2003 prior to my move to Australia [19] He offered to me to move to Australia and we discussed on that agenda. [20] I have read paragraphs 30 and 31 of my affidavit sworn on 12 October 2009 and say that those paragraphs represent a true account of my meeting with Mr Keller referred to therein. [21] I would also like to make the following comments about that meeting i) I recall asking Mr Keller "whether my working accountabilities and conditions including stock options and benefits would remain the same upon my move to Australia". ii) Mr Keller said that "all my accountabilities and benefits would remain the same and all programs available to the employees of Moody's were available to me". iii) I understood Mr Keller to be referring to programs available to senior employees upon retirement or termination. iv) Later on I found out the label for these programs namely the Career Transition Program, which I believe that Mr Takizawa and others in New York and London received. v) I discovered this label in 2005 when I saw the Career Transition Program on the company intranet (as referred of paragraph 38 of my Further Amended Statement of Claim and paragraph 38 of my affidavit sworn 12 October 2009). I have been using that label since to refer to the benefits payable me on the basis of what was received by Mr Takizawa and later by Mr Yamauchi and [22] I had a subsequent meeting with Mr Thomas Keller in the Moody's office in Hong Kong in October or November 2003 prior to my move to Australia [23] I have read paragraph 32 to 34 of my affidavit sworn on 12 October 2009 and say that those paragraphs represent a true account of my meeting with Mr Keller referred to therein. [24] Like I did in the meeting in Tokyo earlier in the earlier, once again I asked Mr Keller "Will my business portfolios and working conditions remain the same should I move to Australia? [25] Mr Keller replied: "Every condition and benefit will remain the same. You have nothing to worry about". Once again I understood Mr Keller to be including the programs available to senior Moody's employees upon retirement or termination later labelled as the career transition program. [26] After this conversation with Mr Keller in Hong Kong in October or November 2003 referred to above I subsequently telephoned Mark Almeida to make sure that what Mr Keller said was shared by Mr Almedia. [27] Mr Almeida said the following words to me "the same benefits and stock options available to you in Japan would be available to you in Australia as they have a global scope". [28] I understood this statement by Mr Almeida to represent and include benefits available to senior Moody's employees upon retirement or termination later labelled as the career transition program 5 In short, the primary judge took the view that that material did not support any part of the second further amended statement of claim as then pleaded. With respect to his Honour, that was a conclusion open to him. Neither Mr Keller nor later, Mr Almeida, said anything about Mr Takisawa. The pleading, in all aspects of it, constructs a claim based on representations concerning Mr Takisawa. What the pleading does not do is state any of the following: that there was a contract or a representation that Mr Takemoto would be paid in Australia what he would have been paid in Japan, and he was not. That is not pleaded in the second further amended statement of claim. Nor is it pleaded that it was represented to him (as his supplementary statement clearly outlines) that he would receive the same working accountabilities and conditions in Australia as he would have received in Japan and/or programs available to any employees of Moody's were available to him and that this did not occur. 6 Rather, the pleading in its various forms with contract, estoppel and representation focuses upon the propositions that either by contract or representation, he was told that he would be paid what Mr Takisawa and Mr Yamauchi would be paid. This matter has proceeded for a significant period of time. His Honour carefully examined the evidence that was said to be available and the nature of the pleadings and on a number of occasions indicated that they did not bear a relationship to each other, such that the pleading was not appropriate to go to trial. As the matter was pleaded in the second further amended statement of claim that was sought to be filed, I can only agree, and I do not see any error in his Honour's assessment of that. Whether or not there is a case that can be pleaded for Mr Takemoto is not my task to identify, beyond what I have already said. What the evidence discloses is that Mr Takemoto was told that he would be paid in Australia with benefits what he would receive in Japan and that he would receive the benefit or programs for Moody's employees. 7 If that is the representation sought to be made, it would need to be asserted to be false or incorrect, whether taking advantage of s 51A or not. That, however, is not what is pleaded. In these circumstances, I do not see any likely prospect of success in persuading an appeal court that the pleading in the form of the second further amended statement of claim should be allowed to go forward to trial. 8 For those reasons I see no utility in granting leave and therefore, the amended application for leave to appeal is dismissed with costs. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Chief Justice Allsop. Associate: Dated: 18 December 2014