New South Wales Supreme Court CITATION : Continental Conveyor & Equipment Pty Ltd v Rossi Gearmotors Australia Pty Ltd [2003] NSWSC 206 HEARING DATE(S) : 24 March 2003 JUDGMENT DATE : 27 March 2003 JURISDICTION: Common Law JUDGMENT OF : Sperling J at 1 DECISION : Order pursuant to paragraph 1 of the notice of motion filed on 13 January 2003, with costs. CATCHWORDS : Practice & Procedure - application for transfer order under cross-vesting legislation - relevant considerations - pre-existing determination refusing a transfer order in relation to proceedings in the other state, where the other proceedings would eventually include the same issues LEGISLATION CITED : Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW), s5, s13 Jurisdiction of Courts (Cross-vesting) Act 1987 (WA) Bankinvest AG v Seabrook (1988) 14 NSWLR 711 Bienvenu v Royal Society for the Protection of Animals [1967] VR 656 Bond v Larobi Pty Ltd (Supreme Court of Western Australia, 31 December 1991, unreported) James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357 CASES CITED : Mullins Investments Pty Ltd v Elliott Exploration Co Pty Ltd (1990) 1 WAR 531 Oceanic Sun Line Special Shipping Company Inc v Fay (1988) 165 CLR 197 Rosenboom & Ors v Qantas Ltd & Ors [2002] NSWSC 792 Rossi Gearmotors Australia Pty Ltd v Continental Conveyor & Equipment Pty Ltd [2003] WASC 42 Spiliada Maritime Corporation v Cansulex Ltd [1987] AC 460 PARTIES : Continental Conveyor & Equipment Pty Ltd Rossi Gearmotors Australia Pty Ltd FILE NUMBER(S) : SC 20555/02 COUNSEL : Mr GK Burton for the Plaintiff Mr TM Thawley for the Defendant SOLICITORS : Thompson Norrie Solicitors for the Plaintiff Shaw McDonald Pty Ltd for the Defendant - 7 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION Sperling J Thursday, 27 March 2003 20555/02 Continental Conveyor & Equipment Pty Ltd v Rossi Gearmotors Australia Pty Ltd Judgment 1 His Honour: On 7 October 2002, proceedings were commenced in the Supreme Court of Western Australia by Rossi Gearmotors Australia Pty Ltd (Rossi) against Continental Conveyor & Equipment Pty Ltd (Continental) claiming the price for the supply of four conveyor drive units. 2 On 27 November 2002, proceedings were commenced in this Court by Continental against Rossi claiming damages on the ground that the equipment supplied was defective. 3 On 17 February 2003, an application by Continental for an order transferring the Western Australian proceedings to New South Wales pursuant to the Jurisdiction of Courts (Cross-vesting) Act 1987 (WA) was heard and determined in the Supreme Court of Western Australia by Roberts-Smith J. His Honour gave reasons for that determination on 14 March 2003: Rossi Gearmotors Australia Pty Ltd v Continental Conveyor & Equipment Pty Ltd [2003] WASC 42. 4 Meanwhile, on 10 January 2003, Rossi filed a notice of motion in this Court applying for an order that the New South Wales proceedings be transferred to the Supreme Court of Western Australia pursuant to the Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW) or, alternatively, that the New South Wales proceedings be stayed. The application came on for hearing before me on 24 March 2003 when Mr Thawley of counsel appeared for Rossi and Mr Burton of counsel appeared for Continental. 5 The legislation in the two states is in the same form. Section 5(2) provides as follows so far as is material: Where – (a) a proceeding (in this subsection referred to as the "relevant proceeding") is pending in the Supreme Court (in this subsection referred to as the "first court"), and (b) it appears to the first court that – (i) the relevant proceeding arises out of, or is related to, another proceeding pending in the Supreme Court of another State or of a Territory and it is more appropriate that the relevant proceeding be determined by that other Supreme Court, (ii) having regard to … the interests of justice, it is more appropriate that the relevant proceeding be determined by that other Supreme Court, or (iii) it is otherwise in the interests of justice that the relevant proceeding be determined by the Supreme Court of another State or of a Territory, the first court shall transfer the relevant proceeding to that other Supreme Court. 6 Under the uniform legislation, there is no appeal from the first instance determination of an application for transfer: s13. 7 There is a divergence of authority as between Western Australia and this state concerning the principles upon which an application pursuant to s5(2) of the legislation is to be decided. In Western Australia, the test for a stay on the ground of forum non conveniens set by the High Court in Oceanic Sun Line Special Shipping Company Inc v Fay (1988) 165 CLR 197 – whether the domestic court is shown to be inappropriate for the trial of the proceedings – has been adopted: Bond v Larobi Pty Ltd (Supreme Court of Western Australia, 31 December 1991, unreported); Mullins Investments Pty Ltd v Elliott Exploration Co Pty Ltd (1990) 1 WAR 531. By contrast, in New South Wales, the more liberal test for a stay on the ground of forum non conveniens set by the House of Lords in Spiliada Maritime Corporation v Cansulex Ltd [1987] AC 460 – which of the competing jurisdictions would be the appropriate forum – has been adopted: Bankinvest AG v Seabrook (1988) 14 NSWLR 711; James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357. The result is a stricter test in Western Australia for a transfer order under the cross-vesting legislation than in New South Wales. 8 What are the relevant considerations to be brought to bear in determining a transfer application under the legislation? Bankinvest and James Hardie are decisions of the NSW Court of Appeal (on reference from single judges) and, as such, are binding on me. 9 In Bankinvest (at 714) Street CJ described a determination under the legislation as "a nuts and bolts management decision". In that case, Rogers AJA, who gave the principal judgment and with whom Street CJ agreed, said (at 728): As Lord Goff said earlier "the question is not one of convenience but of the suitability or appropriateness of the relevant jurisdiction". As the minority pointed out in Oceanic [ Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 62 ALJR 389; 797 ALR 9] (at 396; 21): "... to focus the search on the appropriate forum supplies a broader frame of reference than a concentration on convenience and expense." In my opinion, initially, the search under the Act as in the English courts is for the "natural forum". As Deane J pointed out in Oceanic (at 412; 48), the term "natural" in the context simply means "more appropriate". The expression "natural forum" is given content by Lord Goff (at 478): "... being 'that with which the action had the most real and substantial connection'. So it is for connecting factors in this sense that the court must first look; and these will include not only factors affecting convenience or expense (such as availability of witnesses), but also other factors such as the law governing the relevant transaction (as to which see Crédit Chimique v James Scott Engineering Group Ltd, 1982 SLT 131), and the places where the parties respectively reside or carry on business." The expression was probably first used in the context by Lord Keith in MacShannon v Rockware Glass Ltd [1978] AC 795 at 829. In Spiliada (at 465) Lord Templeman said: "The factors which the court is entitled to take into account in considering whether one forum is more appropriate are legion. The authorities do not, perhaps cannot, give any clear guidance as to how these factors are to be weighed in any particular case." In Oceanic (at 412; 48) Deane J was prepared to accept the relevance of the connecting factors described by Lord Goff in the Spiliada . 10 In James Hardie & Coy Ltd v Barry (2000) 50 NSWLR 357, Mason P said, in the same vein, at [87]: Matters falling solely in category (iii) … are … to be approached on the basis of determining which forum is "more appropriate", in the sense discussed in Spiliada Maritime Corporation Ltd v Cansulex Ltd [1987] AC 460 as distinct from applying the High Court's learning about forum non conveniens in Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 and later cases. 11 In Rosenboom & Ors v Qantas Ltd & Ors [2002] NSWSC 792, I held that connecting factors of the kind referred to in Spiliada did not exhaust the considerations which could legitimately be taken into account. (In that case, I took into account, as a major consideration, that a large number of cases of a similar kind were being jointly case managed in the Supreme Court of Victoria.) 12 In the present case, "nuts and bolts" considerations strongly favour New South Wales as the appropriate forum. The contract was made in New South Wales, the equipment was delivered in New South Wales and is still here, the alleged defective condition of the equipment came to attention in New South Wales, the damage as alleged was suffered in New South Wales, the witnesses are predominantly located in the eastern states, if not exclusively so, and a Victorian company is a potential third party in the New South Wales proceedings. I do not doubt that, but for the determination of Roberts-Smith J, the present application to transfer the New South Wales proceedings to the Supreme Court of Western Australia would fail. 13 It remains then to evaluate the significance of the Roberts-Smith J determination. 14 Mr Burton submitted that the Western Australian determination should be given no weight at all because it was decided in other proceedings and because it was decided on a basis which was incorrect as a matter of law under authority binding on me. Furthermore, Mr Burton submitted, the choice of jurisdiction should not turn on where a determination under the cross-vesting legislation happened to be made first. Mr Thawley, on the other hand, submitted that I should have regard to the practical implications of refusing the present application. 15 I prefer Mr Thawley's approach. If the present application is not granted and the proceedings continue in both states, it is to be expected that each party, as a defendant in the respective proceedings, will plead by way of defence and / or cross-claim the causes of action which they plead in the respective proceedings as plaintiffs. The same issues will then fall to be decided in the respective proceedings. The practical consequence will be that whichever proceeding first comes to trial will dictate the result by res judicata or issue estoppel. Accordingly, if the present application is not granted, the trial forum will be determined by the happenstance of which of the proceedings first comes to trial. There will be a race. Such a situation would bring the law into disrepute. Meanwhile, both proceedings would be worked up, with wasteful duplication in costs. One of the objects of uniform legislation was to avoid such duplication: per Rogers AJA in Bankinvest (at 723G). On the other hand, if the present application is granted, it can be anticipated that the transferred proceedings will either be discontinued or consolidated with the proceedings pending in Western Australia with no further duplication in costs. 16 Mr Thawley also submitted that the principle of issue estoppel precluded Rossi from advancing a case in this Court contrary to the determination of Roberts-Smith J or, alternatively, that the proceedings here should be stayed as an abuse of the processes of this Court by reason of that determination. 17 I am not attracted by this argument. The issue in the present application (whether it is in the interests of justice to transfer the New South Wales proceedings to Western Australia) is not the issue decided by Roberts-Smith J (whether it was in the interests of justice to transfer the Western Australian proceedings to New South Wales), notwithstanding that the issues in the proceedings would eventually be the same were they both to proceed to trial. It further appears that an issue estoppel will usually arise only from a final determination of rights rather than from an interlocutory or purely procedural determination: Bienvenu v Royal Society for the Protection of Animals [1967] VR 656, at 663. 18 Abuse of process also depended upon the same issue having been decided by Roberts-Smith J. 19 In view of my intention to grant Rossi's application on other grounds, it is unnecessary to decide these alternative approaches. 20 Because I intend to grant the application for a transfer order, Rossi's alternative application for a stay of proceedings does not fall to be determined. 21 It is very unsatisfactory that fundamentally different tests for a transfer order under uniform cross-vesting legislation have come to be applied by the Supreme Court of New South Wales and that of Western Australia. In view of the absence of an avenue for appeal to the High Court, it seems that the only sure way of correcting the situation is for the uniform legislation to be amended specifying the test for a transfer order in more precise terms. 22 I make the following orders: Order pursuant to paragraph 1 of the notice of motion filed on 13 January 2003, with costs. -oOo- Last Modified: 04/01/2003 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.