New South Wales Supreme Court CITATION : Reale v Duncan Reale; Duncan Reale v Cameda Investments [2006] NSWSC 227 HEARING DATE(S) : 20 March 2006 JUDGMENT DATE : 3 April 2006 JURISDICTION : Equity JUDGMENT OF : Austin J DECISION : Application for transfer of the proceedings to the Family Court of Australia denied; directions for the purpose of resolving the remaining issues in the proceedings. CATCHWORDS : PRACTICE AND PROCEDURE - transfer of proceedings under Corporations legislation from Supreme Court to Family Court of Australia - proceedings substantially resolved, except for costs - relevant considerations - no issue of general principle. Corporations Act 2001 (Cth), ss 1337C, 1337H LEGISLATION CITED : Family Law Act 1975 (Cth), s 117 Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth), s 5 In Marriage of Bishop (2003) 175 FLR 10 CASES CITED : In Marriage of Warby (2001) 166 FLR 319 Lambert v Dean (1989) 97 FLR 352 TAJ Productions Pty Ltd v White (2005) 56 ACSR 114 1190/05 Maria-Rita Reale (P) Duncan Reale Pty Ltd (D1) PARTIES : Anthony Alan Duncan (D2) 1518/05 Duncan Reale Pty Ltd (P) Cameda Investments Pty Ltd (D1) Anthony Alan Duncan (D2) FILE NUMBER(S) : SC 1190/05; 1518/05 COUNSEL : TGR Parker with P Castley (P) A Harding (D) Minerva Technology Lawyers (P) SOLICITORS : No appearance (D1) Maunsell Pennington Solicitors (D2) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST AUSTIN J MONDAY 3 APRIL 2006 1190/05 MARIA-RITA REALE V DUNCAN REALE PTY LTD & ANOR 1518/05 DUNCAN REALE PTY LTD V CAMEDA INVESTMENTS PTY LTD & ANOR JUDGMENT 1 HIS HONOUR: The present applications are for orders that two proceedings in this court, both brought under the Corporations Act 2001 (Cth), be transferred to the Brisbane Registry of the Family Court of Australia. 2 The applications came before me in a busy Monday Corporations List on 20 March 2006. Counsel for the applicant, Alan Duncan, sought to read an affidavit made by his client on the preceding Friday. There was an objection to part of the affidavit, based on the contention that the respondent/plaintiff had not been given sufficient time to consider and deal with the new material. I indicated that I would allow the contentious material into evidence if it could be shown that the substance of the affidavit had been supplied before close of business on Friday 17 March. Counsel for Mr Duncan tendered some correspondence (Exhibit A2), which showed that Mr Duncan's solicitors had sent a draft copy of the affidavit to the plaintiff's solicitors at "16.38 FRI". Taking that to mean that the draft affidavit was sent at 4:38 p.m. on Friday 17 March, I allowed the whole affidavit to be read. Since the conclusion of the hearing, I have received and read a facsimile transmission to my associate from Mr Duncan's solicitors dated 27 March 2006 (a copy of which was provided to the plaintiff 's solicitors), enclosing a copy of a letter to them from the plaintiff 's solicitors dated 24 March 2006 and their reply dated 27 March 2006. What emerges is that the draft affidavit was transmitted at 4:38 p.m. Brisbane time, or 5:38 p.m. Sydney time. 3 Having considered this new information, I have decided that my decision to allow the whole affidavit to be read should stand. I take into account that the material objected to does not seem to me to be highly prejudicial (for reasons that will appear) or difficult to deal with, that the affidavit was about one page long, that the draft was transmitted only 38 minutes after the end of business hours, and that it would not be unreasonable to expect a solicitor in North Sydney, acting in proceedings in this court, to read, review and take instructions on such an affidavit, transmitted at such a time on a Friday evening, before the commencement of court at 10 a.m. on the following Monday morning. The exhibit also indicates that the draft affidavit was sent to the plaintiff herself by e-mail at 4:43 p.m. (presumably Brisbane time) on the Friday. 4 The underlying dispute in this court is a company dispute connected with the breakdown of the marriage between Mr Duncan and Ms Reale, who have been separated since November 2004. Since that time Mr Duncan has lived in Brisbane, while Ms Reale remains in Sydney, where they lived together before the separation. 5 The first defendant ("Duncan Reale Company" or "the Company") is an Australian company, the directors and equal shareholders of which are Mr Duncan and Ms Reale. It is the trustee of the Duncan Reale Family Trust ("First Trust"), and prior to 21 January 2005 was trustee of the Duncan Reale Family Trust II ("Second Trust"). It does not trade or engage in business activities. 6 Duncan Reale Company owns all of the shares in Cameda Investments Pty Ltd ("Cameda Investments"), another Australian company, the directors of which are Mr Duncan and Ms Reale. Cameda Investments does not trade or engage in business activities. Cameda Investments is the shareholder of Box Information Technology Pty Ltd ("Box Australia"), and Box IT Ltd, a United Kingdom company ("Box IT (UK)"). 7 Prior to its administration, Box Australia's business was to provide software consulting services to clients. Mr Duncan was its sole director until late March 2005. 8 Mr Duncan gave evidence (objected to in the manner indicated above) that, before he separated from Ms Reale in November 2004, he spent approximately 65% of his time working in either Brisbane or Perth. He said that although he had begun the business in Sydney, as it grew most of the business activity took place outside New South Wales. He said that there were only two employees, and Ms Reale, working in the Sydney office in Drummoyne. Ms Reale was responsible for administrative and financial functions. He said that he opened the Brisbane office in July 2003 and that by 2004 the majority of the business activity was taking place outside New South Wales, and consequently the majority of the employees and contractors as well as the external creditors of the business were located outside New South Wales. Voluntary administrators based in Brisbane were appointed to Box Australia on 27 January 2005. A deed of company arrangement was entered into in April 2005 and that arrangement was, according to Mr Duncan, discharged in August 2005. 9 Counsel for Ms Reale contested Mr Duncan's evidence about the location of business activity, tendering company searches for Box Australia and Cameda Investments, each dated 23 December 2004, which in each case showed the company's registered office and current principal place of business as an address in Drummoyne in Sydney (for each company the registered office and the principal place of business were at the same address, but the addresses were different for each company). Mr Duncan's evidence does not explain why the ASIC records do not correspond with the way the business was conducted. 10 According to Mr Duncan, Box IT (UK) does not trade and its sole asset is cash of approximately GBP125,000, though there may be a dispute about this that I need not resolve here. 11 Both sides accept that Duncan Reale Company holds 400,020 shares in Cameda Investments. Half of those shares are held by the Company as trustee of the First Trust, and half are held by it as trustee of the Second Trust. Not all of the documents to give effect to share allotments were signed by Mr Duncan, but Ms Reale's solicitors asserted that he had agreed to the allotments, and (as noted below) Mr Duncan's solicitors acknowledged that this was the case. 12 By notice dated 21 January 2005, Ms Reale purported to exercise a power conferred on her by the trust deed for the Second Trust, by removing Duncan Reale Company as trustee and appointing herself to that office. Her solicitors' covering letter to Duncan Reale Company required the Company, pursuant to its obligations under the trust deed, to do all things necessary to transfer the legal title to the assets of the trust fund, namely 200,000 shares in Cameda Investments, to Ms Reale as the new trustee. The letter said that Ms Reale would be available to attend a directors' meeting at short notice to give effect to the transfer. The letter contained the following explanation: "We are instructed that Mr Duncan has in the last few days excluded Ms Reale and another trusted executive Mr Boyd, from the management of the group and by his conduct is imperilling the business known as IDS which is operated by Box Information Technology Pty Ltd, a wholly-owned subsidiary of Cameda Investments." The letter also requested that, pending the transfer of the shares to Ms Reale, the Company should forthwith take action to ensure that an independent functioning board of directors be appointed to Cameda Investments. 13 Mr Duncan's solicitors responded by writing to Ms Reale's solicitors on the same day. They agreed that steps had been taken to exclude Ms Reale from access to the company bank account and company computers, but they contended that these steps were necessary given Ms Reale's refusal to hand over financial records of Box Australia to Mr Duncan, who was the sole director of the latter company. They alleged that Ms Reale had refused to entertain any sensible discussions or negotiations as to how the business of Box Australia might continue to be conducted in the interests of the shareholders, given the marital breakdown. They alleged that Ms Reale had unilaterally stripped joint bank accounts and company bank accounts. They said they had instructions to institute Family Law proceedings forthwith and to seek injunctive relief to prevent Ms Reale from removing assets from the matrimonial property pool. This is a matter that Boland J found to be significant when she was asked to make interlocutory orders in the Family Court, as noted below (see judgment, para [79]). 14 Mr Duncan's solicitors wrote again to Ms Reale's solicitors on 24 January 2005. They acknowledged that 200,000 of the 400,000 shares issued by Cameda Investments to Duncan Reale Company were held by the Company as trustee for this Second Trust. They said the other 200,000 shares were held by the Company as trustee for the First Trust. Apparently Ms Reale had asserted that another 10 shares had been issued for the benefit of the Second Trust, but Mr Duncan's solicitors said that Mr Duncan was not in a position to acknowledge that this was so. 15 I have mentioned the allegations in the January correspondence so as to make it plain that Mr Duncan and Ms Reale were in bitter conflict at that time. It is unnecessary to trace through subsequent correspondence, and sufficient to say that each party strenuously denied the allegations of wrongdoing made against them. Ms Reale continued to complain about being excluded from business affairs, and on 24 January 2005 she commenced the first of two proceedings in this court, described below. 16 On 28 January Mr Duncan made an Application for Final Orders in the Brisbane Registry of the Family Court, and also made an application for various interlocutory orders. He sought to require Ms Reale to remove herself as trustee of the trust and reinstate Duncan Reale Company, or in the alternative, that she be restrained from exercising her powers as trustee. 17 The first proceeding (No 1190 of 2005) began by originating process filed on 24 January 2005. Ms Reale sought, against Duncan Reale Company as defendant, an order that she be granted leave under s 237 of the Corporations Act to take proceedings in the name of the Company ("the proposed derivative proceeding"). She also sought orders (claims 3 and 4 in the originating process) having the effect that Duncan Reale Company would be required to execute a transfer to her of the 200,010 shares in Cameda Investments held by it as trustee of the Second Trust. 18 The proposed derivative proceeding was to be a proceeding in which Duncan Reale Company would seek against Cameda Investments and Mr Duncan a number of orders to be made under s 233 of the Corporations Act. Section 233 allows the court to make orders in favour of a plaintiff, who has the standing prescribed by s 234, if the plaintiff establishes the matters referred to in s 232, relating generally to oppressive conduct of the affairs of a company. It appears that the allegation was to be that Mr Duncan had acted oppressively in the conduct of affairs of Cameda Investments, entitling Duncan Reale Company, the shareholder of Cameda Investments, to orders that would address the oppression. The orders that were to be sought were orders intended to produce the result that the board of directors of Cameda Investments would consist of one director nominated by Ms Reale, one nominated by Mr Duncan and one independent director nominated by the President of the Institute of Chartered Accountants (Australia). Additionally, an order was to be sought requiring Mr Duncan to compensate Cameda Investments for damage or loss suffered by it because of his oppressive conduct. In the alternative, an order for the winding up of Cameda Investments would be sought under s 461. 19 In their correspondence, the solicitors for the parties disagreed as to whether it was appropriate for proceedings to be prosecuted in this court when there were proceedings in the Family Court that could to address all matters in dispute. This led Mr Duncan to make an application in this court for dismissal or stay of the first proceeding. Both Mr Duncan's application and the originating process came before Hamilton J as Equity Duty Judge on 9 February 2005, and two principal matters were ventilated. 20 First, as to Mr Duncan's application for dismissal or a stay of the proceeding, Hamilton J held ([2005] NSWSC 174, at [5]-[6]) that this court had jurisdiction over the matters in issue in the proceeding having regard to s 4(1) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth), even if the proceeding constituted a matrimonial cause. As to whether the court ought to exercise the jurisdiction it had concurrently with the Family Court, his Honour pointed out that Box Australia had gone into voluntary administration and there were doubts about its solvency. The interests of Cameda Investments in relation to the voluntary administration (including whether it should provide Box Australia with funds to enable it to continue trading) needed to be attended to, and they had to be dealt with at a time earlier than the next relevant application was due to be heard in the Family Court. He pointed out that the voluntary administration also involved the interests of creditors and employees of Box Australia. Because the voluntary administration raised matters of relative urgency, he declined to dismiss or stay the proceeding. 21 Secondly, as to Ms Reale's application, in the originating process, for leave to proceed under s 237, Hamilton J decided that the application was appropriate to be dealt with in view of the urgency of the situation in Cameda Investments (at [8]). He found, subject to one qualification, that the ingredients of s 237(2) had been established, and made orders granting leave to Ms Reale to commence the proposed derivative proceeding in the name of Duncan Reale Company. The qualification was that he did not regard the ingredients of s 237(2) as established with respect to the proposal to seek an order for compensation against Mr Duncan. His Honour granted Ms Reale leave to bring the derivative proceeding, which he made returnable in the Corporations List, and he stood over the balance of the first proceeding (the application for orders for transfer of shares) to the Corporations List. As to the application for the transfer of shares, he found that there was no urgent need to deal with it and that the matter could "at least for the present, abide the attention of the Family Court" (at [7], [14]). 22 On the question whether there was a serious question to be tried as to the matters of oppression to be raised in the proposed derivative proceeding (s 237(2)(d)), he said (at [12]): "Here it is submitted that, in effect, there is no evidence of deadlock or relevant deadlock in Cameda, because there is no specific evidence of disagreement over decisions relating to that company. I regard this approach as totally unrealistic where the evidence shows the complete exclusion of the plaintiff from the affairs of all the companies and that the husband and wife will not speak to each other and cannot deal with each other about the affairs of the companies. In these circumstances, I am of the view that there are serious questions to be tried as to the deadlock of Cameda and oppression in relation to its affairs." 23 His Honour concluded by observing that "whether the principal proceedings are to be tried in this court or the substance of them dealt with in proceedings in the Family Court, is a question that can await another day". At the time when he made these remarks, 9 February 2005, there was a live dispute between the parties as to whether orders should be made to reconstitute the board of directors of Cameda Investments as a board comprising a nominee of the husband, a nominee of the wife and a nominee of an independent third party, and there was a live question as to whether Duncan Reale Company should be ordered to execute a transfer in favour of Ms Reale of the 200,010 shares held by it as trustee of the Second Trust. Since his Honour reserved costs of the application before him, there was also a live issue as to payment of those costs. 24 The second proceeding in this court, No 1518 of 2005, is the derivative proceeding commenced as a result of Hamilton J's order of 9 February 2005 granting leave to Ms Reale under s 237. It is the proceeding proposed by her, except for the proposed claim against Mr Duncan for compensation, as to which Hamilton J refused leave. 25 The voluntary administration of Box Australia was running concurrently with the proceedings before Hamilton J, a fact that clearly influenced his Honour's decision. A meeting of creditors was convened by the administrators. Ms Reale made an urgent application on 17 February 2005 for the appointment of a receiver to Duncan Reale Company. White J made orders by consent on that day, standing over the application generally with liberty to restore, and noting the agreement of the parties to procure Cameda Investments and Box IT (UK) to vote as creditors to support a seven-day adjournment of the meeting. 26 On 24 February 2005 Boland J in the Family Court in Brisbane made orders restraining Ms Reale from exercising her powers as trustee of the Second Trust to remove Mr Duncan as a beneficiary, or to dispose of or encumber assets of the trust, or to exercise her power to appoint another trustee. Her Honour declined to make an anti-suit injunction to restrain Ms Reale from continuing with the Supreme Court proceedings. She delivered an ex tempore judgment in which (at [13]) she described the consent orders made by Barrett J on the previous day as "effectively resolving the [equity] proceedings". She noted (at [70]) that Barrett J's orders of 23 February had granted the parties liberty to apply for variation or discharge of the orders, and liberty to apply with respect to protection of the assets of Cameda Investments during any period where there was no independent director. She held (at [84]) that the application for an order for transfer of shares could be conveniently and appropriately dealt with in the final property proceedings in the Family Court. But she was influenced by a submission on behalf of Ms Reale that, rather than granting an anti-suit injunction that might put at risk of the comity between courts, it would be appropriate for the Family Court to leave it to the husband to seek to transfer the equity proceedings to the Family Court pursuant to the cross-vesting legislation (at [83], [88]). 27 One of the matters about which the solicitors for the parties corresponded in February 2005 was Ms Reale's claim in the first proceeding for an order that the Duncan Reale Company transfer to her 200,010 shares in Cameda Investments. The claim was based on her removal of Duncan Reale Company as trustee of the Second Trust and her appointment of herself as the new trustee, and the Company's obligation as outgoing trustee to vest the trust property in the new trustee. In their letter of 24 January 2005 Mr Duncan's solicitors acknowledged that 200,000 shares in Cameda Investments were held by Duncan Reale Company as trustee for the Second Trust. They queried the claim for the additional 10 shares, and Ms Reale's solicitors replied on 25 January particularising her claim to those shares. On 25 January 2005 Mr Duncan's solicitors wrote offering to do all things reasonably necessary to enable the shareholding in Cameda Investments to be changed so that 200,010 shares would be held by Duncan Reale Company as trustee for the First Trust and 200,010 shares would be held by Ms Reale as trustee for the Second Trust, subject to an undertaking by Ms Reale not to exercise her powers as trustee except in the ordinary course of business. Such an undertaking proved to be unacceptable to Ms Reale, for reasons explained by her solicitors in their letter of 27 January 2005, having to do with her desire to use the shareholding to prevent oppression by Mr Duncan. But that letter left an opening for further negotiation, which was pursued by Mr Duncan's solicitors in their letter of 11 February 2005. Ms Reale's solicitors replied on 14 February 2005 reiterating that their client would not undertake to use the shares only in the ordinary course of business because such an undertaking impliedly would rule out Ms Reale proceeding to appoint a receiver. 28 There was also correspondence between the solicitors for the parties in February 2005 about Ms Reale's claim that the board of Cameda Investments be reconstituted with an additional independent director appointed by the Institute of Chartered Accountants. Mr Duncan's solicitors suggested, in their letter of 25 January 2005, that the parties and their lawyers have a meeting to establish some form of modus operandi for the companies pending final resolution. In their letter of 11 February 2005, Mr Duncan's solicitors acknowledged the need for some interim arrangement for the companies and trusts in the group, and they said their client was open to the possibility of appointing a third director of the companies to resolve deadlocks, and open also to reaching agreement on critical issues relevant to the conduct of the companies and trusts. By their letter of 14 February 2005, Ms Reale's solicitors said they agreed with the suggestion that a third director be appointed to resolve the deadlock in Cameda Investments and other group companies, and suggested that the third director be appointed by the President of the Institute of Chartered Accountants. 29 Mr Duncan's solicitors took the matter a step further on 16 February 2005, when they sent Ms Reale's solicitors a letter setting out a more formal settlement proposal, according to which Ms Reale and Mr Duncan would do whatever was necessary to cause a third director to be appointed to Cameda Investments, with provision for that director to be nominated by the Institute of Chartered Accountants if they could not agree. On the same day Ms Reale's solicitors responded, suggesting some names for the role of third director, and agreeing to other terms. This process culminated in consent orders made by Barrett J on 23 February 2005. The orders provided for the board of directors of Cameda Investments to comprise a nominee of each of Ms Reale and Mr Duncan and an independent director appointed by a process in which the default power of appointment was with the President of the Institute of Chartered Accountants. 30 A problem arose with these arrangements after the orders had been made. On about 1 March 2005 the Australian Institute of Charted Accountants indicated they would not assist in the appointment of a third director, and therefore Ms Reale's lawyers foreshadowed an application to the court for appointment of a receiver to Cameda Investments, to enable Cameda Investments to vote at the meeting of creditors of Box Australia, which by that time was scheduled for 5 March. Mr Duncan's solicitors wrote on 1 March 2005 setting out a settlement proposal under which Ms Reale would take over the control and operation of Box Australia, subject to certain conditions. The letter put forward some reasons why Ms Reale should not proceed with her application for the appointment of a receiver. Ms Reale's solicitors replied on 3 March 2005, disagreeing with part of the settlement proposal but indicating a willingness to adjourn her interlocutory application for the appointment of a receiver and to cause the adjournment of the meeting of creditors of Box Australia. On 3 March 2005 Campbell J made consent orders varying the orders that had been made by Barrett J on 23 February by postponing their commencement for a short time, and noting the agreement of the parties to procure Cameda Investments and Box IT (UK) to vote as creditors at a meeting of creditors of Box Australia to be held on 4 March 2005, to procure a nine-day adjournment. 31 The equity proceedings were listed for further hearing on 16 May 2005. On 13 April 2005 Mr Duncan's solicitors wrote to Ms Reale's solicitors saying it would appear that the only outstanding issue in the first proceeding was the proposed transfer of 200,010 shares in Cameda Investments from Duncan Reale Company to Ms Reale as trustee of the Second Trust. They said that Mr Duncan would agree to orders for the transfer of those shares provided that in net terms the result was that each of the two trusts would have the same holding. There was no reply to that letter until much later, as noted below. However, on 3 May 2005 Ms Reale's solicitors wrote to Mr Duncan's solicitors drawing attention to the listing of the proceedings for 16 May and proposing an adjournment for six months, "in view of the possibility that orders eventually to be made in the Family Court may not require Duncan Reale to seek the orders in the process". The letter also raised the question whether Mr Duncan would consent to an order for costs in favour of Ms Reale. Mr Duncan's solicitors replied agreeing to an adjournment and saying that an argument on costs would be best left until after the substantive issues had been finalised. 32 The equity proceedings were listed before Hamilton J on 10 June 2005, for directions for a hearing as to the costs of the hearing that had been before him in early February 2005. His Honour declined the application on the basis that the proceedings had not been fully determined. When Hamilton J stood the proceedings into the Corporations List, his orders noted: "Matter may be referred to me for determination of costs reserved on 9 February 2005 when this is appropriate". 33 When the equity proceedings came before Barrett J on 16 May 2005, they were stood over to 14 November 2005. On 14 November 2005 there was no appearance for Ms Reale, and Barrett J stood the proceedings over 20 February 2006. Mr Duncan's solicitors wrote to Ms Reale's solicitors on 18 November 2005, noting Ms Reale's failure to appear at the hearing on 14 November and stating their client's intention to move on a motion that the balance of the first proceeding be removed to the Family Court on the ground that the remaining matters, relating to the transfer of the shares, were "congruent with matters before the Family Court". 34 Finally, on 17 March 2006 Ms Reale's solicitors wrote to Mr Duncan's solicitors setting out, in a separate letter, a proposal for the resolution of the derivative proceeding. The separate letter pointed out that no independent director had been actually appointed pursuant to Barrett J's orders of 23 February 2005, but the trading activities of Box Australia had been "put on a proper basis by the administrator". According to the letter, the administration was then terminated and the business was thereafter conducted by directors appointed by the administrator. The letter said the business had later ceased to trade but Box Australia was continuing to pursue the recovery of debts from customers and suppliers. The letter proposed that any future issues as to the division of the assets of Cameda Investments could be dealt with by the Family Court. In those circumstances, the letter proposed that the consent orders made on 23 February 2005 be discharged and the derivative proceeding discontinued, with the consent of the court under s 240 of the Corporations Act. The letter made an offer regarding costs of the derivative proceeding. 35 Ms Reale's solicitors' covering letter of 17 March 2006 referred to claims 3 and 4 in the originating process for the first proceeding (No 1190 of 2005), the claims for transfer of shares. The covering letter was a response, over 11 months after it had been made, to Mr Duncan's offer (made in his solicitors' letter of 13 April 2005) to agree to orders for the transfer of shares to Ms Reale provided that in net terms each trust would have the same shareholding. The letter said Ms Reale accepted that each trust has an equal shareholding and that the relief she sought in the originating process related only to the shares held by Duncan Reale Company as trustee for "her" trust. The letter made a proposal as to costs of the first proceeding. 36 The two letters of 17 March 2006 were written two days after Mr Duncan had filed interlocutory processes in each of the two equity proceedings seeking orders for the transfer of the proceedings to the Brisbane Registry of the Family Court of Australia. The interlocutory processes filed on 15 March did not refer to the court's power to order the transfer of proceedings under the Corporations Act. They were replaced by interlocutory processes filed in court on 20 March 2006. The relief is now sought pursuant to s 1337H(1) of the Corporations Act, or alternatively under s 5(1)(b) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth). 37 In my opinion the applicable provisions are in Part 9.6A Division I of the Corporations Act, which includes s 1337H(1). Section 1337A(1) says that the Division deals with the jurisdiction of courts in respect of civil matters arising under the Corporations legislation. The two proceedings in this court are civil matters arising under the Corporations legislation because the principal relief in the first proceeding is leave to bring a derivative proceeding under s 237 of the Corporations Act, and in the second proceeding, relief is sought under the oppression provision in s 233 of the Corporations Act. Section 1337A(2) says that the Division operates to the exclusion of the Jurisdiction of Courts (Cross-vesting) Act 1987. 38 Section 1337H applies, inter alia, where the court in which the proceeding has been brought ("the transferor court") is a State Supreme Court. Section 1337H(2) provides that if it appears to the transferor court that, having regard to the interests of justice, it is more appropriate for the relevant proceeding to be determined by another court that has jurisdiction in the matters for determination in the relevant proceeding, the transferor court may transfer the relevant proceeding to that other court. The Family Court of Australia has jurisdiction with respect to the matters for determination in the two proceedings before this court, because s 1337C(1) gives that court jurisdiction with respect to all civil matters arising under the Corporations legislation. It also has available a wide accrued jurisdiction, according to decisions made by the Full Court of the Family Court: In Marriage of Warby (2001) 166 FLR 319; In Marriage of Bishop (2003) 175 FLR 10. 39 Thus, the central question to be addressed is whether, having regard to the interests of justice, it is appropriate that the two proceedings be determined by the Family Court. This is supplemented by s 1337L, which requires the court to have regard to: (a) the principal place of business of any body corporate concerned in the proceeding or application; and (b) the place or places where the events that are the subject of the proceeding or application took place; and (c) the other courts that have jurisdiction to deal with the proceeding or application. The requirements of s 1337L are not exhaustive - the section merely enumerates three factors to which the court must pay regard, in addition to the requirement that the court be satisfied that the interests of justice require the transfer: TAJ Productions Pty Ltd v White (2005) 56 ACSR 114 at [5]. 40 Here, as I have pointed out, there is some inconsistent evidence as to the location of the principal places of business of Box Australia and Cameda Investments. At its highest in favour of Mr Duncan, the evidence would show that the major part of the active business was conducted in Queensland. But the remaining issues in the equity proceedings are not about the conduct of business by any body corporate. There are no longer any active businesses in the group. Therefore in the present case the principal place of business of those bodies corporate that are concerned is not a decisive consideration. 41 As to the place or places where the events that are the subject of the proceeding took place, Ms Reale's complaints relate principally to allegations of misconduct by Mr Duncan in respect of the management of Box Australia which, according to Mr Duncan, carried on most of its activities outside New South Wales. But those allegations are no longer in issue in the equity proceedings, since the substantial relief sought in the derivative proceeding has been granted by the consent orders made by Barrett J on 23 February 2005, and there seems to be no substantive contest between Ms Reale and Mr Duncan as to whether shares should be transferred to her as trustee for the Second Trust. The only outstanding matters of significance relate to costs, and as to those matters the relevant events took place in correspondence. I therefore do not regard the place or places where the events took place as a decisive consideration in this case. 42 As to the other courts that have jurisdiction, there is no difficulty about the Family Court's jurisdiction and there is no suggestion that the transfer, if made, should be to any other court. 43 Since the criteria in s 1337L are of little or no assistance in this case, I am left to consider other matters going to the appropriateness of the transfer and the interests of justice. 44 Mr Duncan gave evidence at the hearing of the transfer application that the effect of running litigation in both this court and the Family Court has been to place a large financial burden on him. He said he has paid over $102,000 in legal fees and still owes over $63,000. He said his assets cannot be easily liquidated until the determination of the Family Court proceeding because all his assets are jointly owned with Ms Reale. He said his current disposable income is completely absorbed in legal fees and living expenses and that he no longer has the means to continue to battle in two jurisdictions. I accept this evidence for the purposes of the present applications. 45 I agree that every effort should be made to have all aspects of a dispute between litigants addressed in a single proceeding in a single court, unless there is a very good reason for separation. In the present case one party came to this court raising corporate issues and within a few days, the other party commenced a proceeding in the Family Court. The voluntary administration of the active business entity, Box Australia, made it practically necessary, as Hamilton J decided, that the equity proceedings be allowed to continue so that the decisions necessary for the voluntary administration could be taken effectively. But those pressures no longer exist, and now the most important consideration is to see to it that the remaining aspects of the entire dispute are resolved on a final basis, as efficiently and inexpensively as possible. It seems to me plain that the court that is usually the most appropriate to resolve all outstanding issues in a case such as this, and would be the most appropriate Court in the present case but for the special considerations I shall mention, is the Family Court. Any questions of entitlements with respect to corporate entities, particularly Cameda Investments, will be questions about the property rights of the spouses and no-one else (see the judgment of Boland J, para [64]). 46 The special circumstances that take the present case out of the ordinary relate to the fact that the two equity proceedings are now close to final resolution, apart from questions of costs. The applications, affidavits and correspondence in evidence show that the first proceeding in this court made claims for leave of two kinds, apart from costs: orders for the transfer of shares, and orders for leave to bring a derivative proceeding seeking reconstitution of the Cameda Investments board. 47 The transfer of shares is the only matter outstanding in the first proceeding apart from costs. Ms Reale's application for orders for the transfer of shares was substantially resolved when, by their letter of 17 March 2006, her solicitors accepted the offer by Mr Duncan's solicitors made on 13 April 2005, and renewed on 18 November 2005. I do not regard the expression of opinion in the letter of 18 November that "in any event" the issue of transfer of shares should be properly dealt with in the Family Court as amounting to a withdrawal of the offer made on 13 April, which had been reiterated in the previous paragraph of the 18 November letter. As I understand the evidence, the position now is that the parties have completely or substantially agreed that they will cause Duncan Reale Company to transfer 200,010 shares in Cameda Investments to Ms Reale as trustee of the Second Trust, leaving 200,010 shares held by Duncan Reale Company as trustee of the First Trust. Ms Reale's holding with respect to the Second Trust will remain subject to the interlocutory injunctive orders made by the Family Court. Even if the correspondence had not demonstrated a firm agreement on this matter, it at least showed that at this stage there is no substantive difference between the parties on this issue, other than the question of costs. 48 Counsel for Mr Duncan cited Lambert v Dean (1989) 97 FLR 352, where McLelland J said (at 353): "the most critical issue will be whether orders affecting the property should be made in the exercise of the discretion provided by the Family Law Act. The question of whether that discretion should be exercised, and if so to what extent, is a matter which falls to some extent within the specialised expertise of the Family Court, and this renders it more appropriate that the matter be dealt with fully in that Court." 49 Those observations would be very persuasive if there remained in the equity proceedings some significant, contested proprietary determinations. But all that remains of a proprietary nature is the order for transfer of shares. That order will merely vest in the new trustee of the Second Trust the shares that are the property of that trust. It will not seek to adjust the beneficial ownerships lying behind the trusts, or derogate from the Family Court's discretionary powers with respect to matters of property, or prevent the Family Court from making some discretionary adjustment to the property holdings of the trusts. Moreover, the order that is proposed for the transfer of shares is no longer controversial between the parties. 50 As to the reconstitution of the Cameda Investments board, (that is, the relief sought in the derivative proceeding), the consent orders made by Barrett J on 23 February 2006 may not have amounted to final resolution of the matter had they been acted on, because the orders reserved liberty to the parties to move for interlocutory relief if at any time an independent director was not in place. But as no independent director was appointed and the affairs of Box Australia developed in a different way, the need for an independent director appears to have evaporated. It seems to me that the proposal by Ms Reale's solicitors in their letter of 17 March 2006, namely that Barrett J's orders be dissolved and the proceeding be discontinued with leave, is a sensible means of bringing the derivative proceeding to an end (I say nothing about the reasonableness of their proposal with respect to costs). There may be some future issues as to the division of the assets of Cameda Investments, but they can and should be dealt with by the Family Court. No transfer of proceedings is needed for that purpose. Indeed, to transfer the derivative proceeding to the Family Court would achieve nothing useful and might obscure the issues for final resolution of the dispute. 51 Although progress towards the resolution of issues between the parties has been very slow so far, it seems to me that a judicially-supervised winding up of those issues should be achieved expeditiously. 52 There is, obviously, one substantive issue about the equity proceedings that has to be decided. That is the question of costs. I can see that there are some unresolved issues both with respect to the application dealt with by Hamilton J and with respect to other applications, no doubt including the ones I am addressing now. In my view it would be unacceptable, and antithetical to the objective of achieving an outcome that is just, quick and cheap (as required by s 56(1) of the Civil Procedure Act 2005 (NSW)) for this court to transfer to the Family Court to proceedings which have been substantially resolved except for costs. That would leave it to the Family Court to deal with questions concerning the costs to be awarded in respect of applications made in another court, notwithstanding that the other court is in a position to deal with costs, in circumstances where the questions to be resolved might touch upon some matters of company law within the specialised expertise of this court. In my view the correct course is that this court should determine all questions of costs in the equity proceedings. If it does so, the equity proceedings will have come to an end and there will be nothing left to transfer to the Family Court. 53 Counsel for Mr Duncan drew attention to the difficulty of framing an appropriate costs order in favour of his client, when the plaintiff in proceeding No 1518 of 2005 is Duncan Reale Company. If the Company is ordered to pay Mr Duncan's costs he will have a pyrrhic victory, because the effect of costs recovery would be to dilute matrimonial property. That kind of difficulty flows from the central characteristic of derivative proceedings, but the Corporations Act s 242 allows the court to make an appropriate order about the costs of the company or any other party to the proceedings, and this gives the court a degree of flexibility to address the problem identified by counsel. 54 Counsel for Mr Duncan also submitted that issues of costs would be better left to the Family Court, where the award of costs is conditioned by a statutory regime specifically intended to apply to disputes affecting matrimonial property. He referred to s 117 of the Family Law Act 1975 (Cth). There are four difficulties with this submission. First, it involves the substantial inefficiency of requiring a judge of the Family Court to become familiar with what occurred in another court, for the purpose of making a determination of costs, when several judges of the other court, one of whom would be likely to be available for the costs hearing, have already been required to familiarise themselves with the case. Secondly, it overlooks the fact that cost orders in proceedings which combine personal causes of action with company causes of action, asserted derivatively, attract their own special considerations. Thirdly, it tends to deny to the successful party the right to a determination of costs by the court in which the proceedings were conducted, subject to the costs rules of that court. Fourthly, s 117 applies only to proceedings under the Family Law Act, not to proceedings under the Corporations legislation brought in a State Supreme Court and transferred to the Family Court under s 1337H (and note s 1337P). 55 Counsel for Mr Duncan drew attention to the fact that Ms Reale had resisted Mr Duncan's application for an anti-suit injunction in the Family Court by submitting, as I have pointed out, that it would be open to Mr Duncan to seek orders for the transfer of the proceedings to the Family Court at a later time. But in my opinion this should not be held against Ms Reale. The circumstances have changed since Boland J dealt with the injunction application on 24 February 2005. Now there is no substantial disagreement between the parties about the subject matter of the two equity proceedings, except as regards costs. 56 Counsel for Mr Duncan also submitted that Ms Reale had done little to prosecute the equity proceedings. Submissions of that kind will be relevant to questions of costs, but they do not provide a basis for transferring the equity proceedings in the circumstances of the present case. He also submitted that the utility of the equity proceedings was questionable, given that no third director had ever been appointed pursuant to the orders of 23 February 2005. But the evidence indicates that the reason no third director was appointed was that the administrators were able to put the business affairs of Box Australia in order and appoint new directors, and so the need for decision-making at the shareholder level was removed or reduced. 57 I think the most appropriate course for me to take, having regard to the interests of justice, is to deny Mr Duncan's application for transfer of the equity proceedings to the Family Court. I shall also give some directions designed to finalise all outstanding issues in the equity proceedings quickly and efficiently, and thereby to minimise the financial hardship that the parties are suffering by virtue of having aspects of their dispute dealt with in two separate courts. As the proposed orders are a little complex, I shall defer making them for 24 hours, in case they present some unforeseen major difficulty for either of the parties. The orders will be made in chambers unless some such difficulties are raised within that period, by e-mail or facsimile to my associate and to the other party. 58 The orders and directions that I intend to make are: (1) In each proceeding, the application by Mr Duncan filed on 20 March 2006 for transfer of the proceeding to the Brisbane Registry of the Family Court of Australia is denied. (2) In proceeding No 1190 of 2005: (a) direct the plaintiff to prepare draft short minutes of orders for final relief (except as to costs), and to submit the draft to Mr Duncan and my associate, by no later than Wednesday 5 April 2006; (b) stand the proceeding over to 9:30 a.m. on Wednesday 12 April 2006 before me, for the making of orders or further directions. (3) In proceeding No 1518 of 2005: (a) direct the plaintiff, by no later than Friday 7 April 2006, to file and serve an interlocutory process for orders discharging the orders made by Barrett J on 23 February 2006, and for leave under s 240 of the Corporations Act 2001 (NSW) to discontinue the proceeding, made returnable at 9:30 a.m. on Wednesday 12 April 2006 before me; (b) direct the plaintiff to notify the second defendant and my associate in writing of the evidence upon which it will rely in support of the interlocutory process, and where appropriate file and serve that evidence, on or before Friday 7 April 2006. (4) In respect of both proceedings: (a) fix Friday 28 April 2006 at 10 a.m. for the hearing by me of all outstanding issues of costs in both proceedings, including the application heard by Hamilton J ("the Outstanding Costs Issues"); (b) direct Ms Reale to notify Mr Duncan and my associate in writing of the evidence upon which she will rely in respect of the Outstanding Costs Issues, and where appropriate file and serve that evidence, on or before Monday 10 April 2006; (c) direct Mr Duncan to notify Ms Reale and my associate in writing of the evidence upon which he will rely in respect of the Outstanding Costs Issues, and where appropriate file and serve that evidence, on or before Thursday 13 April 2006; (d) direct Ms Reale to provide to Mr Duncan and my associate her succinct written submissions on the Outstanding Costs Issues, on or before Friday 21 April 2006; (e) direct Mr Duncan to provide to Ms Reale and my associate his succinct written submissions on the Outstanding Costs Issues on or before Wednesday 26 April 2006; (5) In both proceedings, grant liberty to apply to me at 9:30 a.m. Monday to Friday, on 48 hours notice. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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