New South Wales Supreme Court CITATION : Orbit Travel Services & Ors v The Australian Federation of Travel Agents & Anor [2000] NSWSC 127 CURRENT JURISDICTION: Common Law FILE NUMBER(S) : SC 20301/1999 HEARING DATE(S) : 2 March 2000 JUDGMENT DATE : 9 March 2000 Orbit Travel Services Pty Limited (First Plaintiff) Bassilios Abdul-Karim (Second Plaintiff) PARTIES : Katia Abdul-Karim (Third Plaintiff) v The Australian Federation of Travel Agents limited (First Defendant) Travel Compensation Fund (Second Defendant) JUDGMENT OF : Master Malpass Mr B Coles QC/Mr M Abdul-Karim (Plaintiffs) COUNSEL : N/A (First Defendant) Mr N Francey (Second Defendant) SOLICITORS : David Cass (Plaintiffs) No appearance (First Defendant) Minter Ellison (Second Defendant) CATCHWORDS : Summary Dismissal Anshun estoppel exercise of discretionary power. LEGISLATION CITED : Trade Practices Act 1974, s 53. Travel Agents Act 1986, s 40. Ling v Commonwealth of Australia (1996) 139 ALR 159. Macquarie Bank Limited v National Mutual Life Assurance of Australia Limited and Others (1996) 40 NSWLR 543. Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 589. CASES CITED : Stehar Knitting Mills Pty Ltd v Southern Textile Converters Pty Ltd (1980) 2 NSWLR 514. Tanning Research Laboratories Inc v O'Brien (1990)169 CLR 332. Yah Tung InvestmentCo Ltd v Dao Heng Bank Ltd (1975) AC 581. DECISION : See paragraph 16. THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION MASTER MALPASS THURSDAY 9 MARCH 2000 20301/1999 ORBIT TRAVEL SERVICES PTY LIMITED & ORS v THE AUSTRALIAN FEDERATION OF TRAVEL AGENTS LIMITED & ANOR JUDGMENT 1 In 1996, the first plaintiff brought proceedings in the Equity Division against inter alia the second defendant. It sought an injunction. The second defendant brought a Cross-Claim against certain parties (including the plaintiffs). It sought inter alia declarations as to liability (by reason of the provisions of s 40 of the Travel Agents Act 1986). The section confers rights of subrogation where a payment is made to a claimant under the statutory compensation scheme. The Cross-Claim was defended on the basis that the Cross-Defendants owed no liability. The questions of liability were determined in favour of the Cross-Claimant. The finding of liability was founded on the failure of the first plaintiff to adequately supervise one of its agents (Vera Nemes). 2 In these proceedings, the plaintiffs' claim is founded both on negligence and contravention of s 53 of the Trade Practices Act 1974. In substance, it is alleged that there was a failure to advise or warn. The claims have been described as being novel. 3 The second defendant now moves for summary dismissal of the claims brought against it. It is alleged that the claims must fail because of what was decided in Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 589. 4 The evidence is comprised by a supporting affidavit from the solicitor for the second defendant. Largely, it is of a formal nature. 5 The court has a discretionary power to grant summary relief. The discretion is exercised having regard to the relevant circumstances of the particular case before it and so that justice is best served between the parties. There is abundant authority for the proposition that summary relief should be granted only in what might be described as clear cases. The applicant bears the onus of satisfying the court of entitlement to relief. 6 The second defendant contends that the claim now made in these proceedings could have and should have been raised in the proceedings in the Equity Division and that it was unreasonable for the plaintiffs not to do so. It was first said that the claim should have been litigated by the raising of a defence of contributory negligence. This approach was later abandoned. It was then said that the claim should have been raised by way of either Set-Off or Cross-Claim. 7 The plaintiffs take issue on a number of matters. I shall mention some of them. There is issue as to whether or not the claims either could have or should have been raised in the Equity proceedings. Further, it was said that whatever may be the position on those questions, it was not unreasonable for them to not raise them in the Equity proceedings. They have drawn attention to Stehar Knitting Mills Pty Ltd v Southern Textile Converters Pty Ltd (1980) 2 NSWLR 514 (only equitable set-offs can be pleaded as a defence). They contend that these proceedings will not produce a judgment which conflicts with the earlier judgment. 8 At the outset, it should be observed that the second defendant is seeking summary intervention, which if granted, will deprive the plaintiffs of having their case determined in the usual manner at a trial. A full hearing accords the advantage of the additional material that can be expected to be placed before the court. 9 In Anshun , at pp 602 - 603, it was observed that:- "In this situation we would prefer to say that there will be no estoppel unless it appears that the matter relied upon as a defence in the second action was so relevant to the subject matter of the first action that it would have been unreasonable not to rely on it. Generally speaking, it would be unreasonable not to plead a defence if, having regard to the nature of the plaintiff's claim, and its subject matter it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding. In this respect, we need to recall that there a variety of circumstances, some referred to in the earlier cases, why a party may justifiably refrain from litigating an issue in one proceeding yet wish to litigate the issue in other proceedings e.g. expense, importance of the particular issue, motives extraneous to the actual litigation, to mention but a few." 10 During the course of argument, I expressed my reservations as to the appropriateness of the procedures for summary relief where the defence was founded on Anshun . Whilst it will undoubtedly depend on the issues agitated by the parties, it seems to me that Anshun considerations may rarely lead to summary dismissal. Apart from the unclear state of the law, an Anshun defence may throw up a number of questions (including the question of "unreasonableness") which may not be appropriate for determination on a summary basis. The court may also have to form a view as to the result of a potential exercise of discretion. As these matters were not the subject of argument, I put them aside. 11 There is much uncertainty that surrounds Anshun . In Tanning Research Laboratories Inc v O'Brien (1990) 169 CLR 332 at p 355, it was said that the scope of Anshun remains a matter of some debate. More recently it has been said that one thing that is clear about Anshun is that there is much that is unclear (71 ALJ 934 at 942). In Macquarie Bank Limited v National Mutual Life Assurance of Australia Limited and Others (1996) 40 NSWLR 543 at p 558 Clarke JA (with whom Priestley JA agreed) observed that the appropriate order is a stay of proceedings and that the court retains a discretion not to grant a stay if special circumstances exist. The Privy Council in Yah Tung Investment Co Ltd v Dao Heng Bank Ltd (1975) AC 581 at p 590 appears to take the approach that "special circumstances" and "unreasonableness" were separate issues. A contrary view was taken by the Federal Court ( Ling v Commonwealth of Australia (1996) 139 ALR 159). 12 In this case, it is unnecessary to embark upon a detailed analysis of the various arguments agitated during submissions. There are questions pertaining to the issue of whether or not the claims in these proceedings should have been raised in the Equity proceedings. In the circumstances of this case, it is unnecessary to pursue these matters, because it seems to me that there are real questions as to whether or not it would have been unreasonable for them not to do so. 13 Questions such as "unreasonableness" involve a determination by the court made in the context of all the relevant circumstances. In my view, such a question is generally better left for determination at a trial. In a case such as the present one, where the evidence is relatively sparse, it falls short of demonstrating "unreasonableness". 14 I have put aside any question of "special circumstances" and "discretion". These matters were not argued by the parties. 15 Accordingly, I am not satisfied that the second defendant has demonstrated a case entitling it to summary disposition of the claims. It has not been shown to be one of those clear cases. In my view, justice is best served between the parties if the application is dismissed. 16 The Notice of Motion filed on 22 September 1999 is dismissed. The second defendant is to pay the costs of the plaintiffs. ********** Last Modified: 09/25/2000 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.