Supreme Court New South Wales Medium Neutral Citation: Mineralogy Pty Ltd v Sino Iron Pty Ltd [2013] NSWSC 466 Hearing dates: 30 April 2013 Decision date: 30 April 2013 Jurisdiction: Equity Division - Commercial List Before: Stevenson J Decision: The proceedings be transferred to the Supreme Court of Western Australia Catchwords: PRACTICE AND PROCEDURE - cross-vesting - whether in the interests of justice that the proceedings be transferred to the Supreme Court of Western Australia - no obvious connection to New South Wales - relevance of likely case management procedures in the Supreme Court of Western Australia Legislation Cited: Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) Cases Cited: BHP Billiton Ltd v Schultz (2004) 221 CLR 400 Category: Interlocutory applications Parties: Mineralogy Pty Ltd (plaintiff/respondent) Sino Iron Pty Ltd (first defendant/applicant) Korean Steel Pty Ltd (second defendant/applicant) CITIC Pacific Ltd (third defendant/applicant) Representation: Counsel: A J Myers QC with D P Robinson SC and P Zappia (plaintiff/respondent) C M Scerri QC with S H Parmenter (defendants/applicants) Solicitors: Hugh & Associates Lawyers (plaintiff) Allens (defendants/applicants) File Number(s): SC 2013/82818 Publication restriction: Nil EX TEMPORE Judgment (Revised 30 April 2013) 1These proceedings were commenced on 8 March 2013. 2By a notice of motion filed on 18 April 2013, the defendants seek an order pursuant to s 5(2) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) that the proceedings be transferred to the Supreme Court of Western Australia. 3There is no dispute before me as to the test I must apply in determining this application. There is a statutory requirement that I exercise the power to transfer these proceedings to the Supreme Court Western Australia if "it appears" that it is in the interests of justice to do so. This is not a discretionary matter. It is not necessary that I conclude that this Court is a "clearly inappropriate" forum. It is both necessary and sufficient that, in the interests of justice, the Supreme Court of Western Australia is more appropriate: BHP Billiton Ltd v Schultz (2004) 221 CLR 400 at [14] per Gleeson CJ, McHugh and Heydon JJ and at [62] - [63] per Gummow J. 4The plaintiff and first and second defendants are parties to Mining Right Site Lease Agreements which the plaintiff has described as the "Sino and Korean Agreements". The third defendant is said to have guaranteed the second defendant's obligation under the Korean Agreement. 5The agreements require that the first and second defendants pay the plaintiff a "determined royalty" in certain circumstances including, amongst others, if they do not produce six million tonnes of iron ore within seven years of the commencement of the agreements. The plaintiff contends that the first and second defendants will not produce that amount of ore in time. 6The plaintiff contends that the first and second defendants have evinced an intention not to perform their obligations under the agreements and that those defendants have also breached their obligations of good faith. 7The plaintiff has calculated the royalty to be paid and seeks an order, by way of specific performance of the agreements, that it be paid together with certain declarations. 8An issue that will arise is the proper construction of the agreements. Another issue that will arise is what the plaintiff describes as "performance" of the agreements. 9The defendants have not filed a Commercial List Response. However, the unchallenged evidence of Mr Gerard Woods, who is the solicitor acting for the defendants, is that the defendants will raise by way of defence, amongst other matters, a contention that they are entitled to rely upon provisions of cl 6.3 of the agreements which provides: - "(a) Unless prevented from doing so by an act, matter or thing outside of [the first and second defendants] control, by the doing of, or failing to do, an act by [the plaintiff] under this Agreement or otherwise, or a failure to obtain all Government Approvals necessary for it to do so (provided it has used its best endeavours to obtain such approvals in a timely manner) [the first and second defendants] must produce no less than 6,000,000 (six million) tonnes of Product no later than 7 years from the date of this Agreement." 10The plaintiff submits that this proposed defence is a "recent invention" and that it represents a "false issue". The plaintiff contends that the defendants have not foreshadowed reliance on cl 6.3 in the past when opportunities have arisen when it might be expected they would. I cannot, and should not, investigate the merits of that contention on this application. The fact is the defendants, through their solicitor, have informed the Court that the issue is to be raised. 11The proceedings appear to have no connection at all with New South Wales. There is considerable weight in the defendants' contention that the Supreme Court of Western Australia is the natural forum for the proceedings. 12The plaintiff, in its written submissions, said that "[t]he benefit to both parties in Sydney is the speedier determination of an important issue of immediate practical application" and that "[t]he issue between the parties is able to be determined more expeditiously in Sydney than would be possible in Perth". 13Mr Myers, of Queen's Counsel, who appeared with Mr Robinson of Senior Counsel and Mr Zappia for the plaintiff, accepted that this was the basis upon which the order for cross-vesting is resisted. 14Mr Clive Palmer, the Chairman of the plaintiff, has sworn an affidavit deposing to the urgency of early resolution of these proceedings. The proceedings certainly involve a very large amount of money. There appears to be no contest that the proceedings should be heard quickly. Indeed Mr Scerri, of Queen's Counsel, who appeared with Mr Parmenter for the defendants, has foreshadowed that the defendants would support an application for expedition of the proceedings, were they to be transferred to Perth. 15In the Supreme Court of Western Australia there is a Commercial and Managed Cases List ("the CMC List") in which proceedings are allocated to a docket judge. 16Mr Wilenski, the solicitor for the plaintiff, gave evidence in relation to matters in the CMC List as follows: - "In my experience the speed in which a matter on the CMC List is determined largely depends upon the particular judge allocated to the matter, the steps taken by the parties co-operatively and that judge's availability to deal with the matter in the short to medium future." 17Mr Wilenski also drew attention to the fact that in the 2011 Annual Review of the Supreme Court of Western Australia the following remarks were made in relation to how long cases take to get to trial: - "This year, it took slightly longer to list cases for trial. The median time to list civil trials from lodgement grew from 89.5 weeks last year to 93 weeks this year. This result is broadly consistent with recent years and is considered to be within the acceptable range, albeit the upper end. Cases on Hand The number of cases on hand as at 31 December 2011 was 3626, an increase of 429 cases or 13% on 2010. The increase in pending cases is due to an increase in the number of new cases commenced rather than the court not keeping up with its caseload. However, it is of concern that the number of pending cases older than 12 months increased from 957 to 1142 and the Court will take steps to address the older cases in 2012." 18Mr Wilenski also annexed to his affidavit an article from "The West Australian", published on 15 April 2013, in which it was reported that: - "...WA's top judge has warned that the State's highest court could be hit by a backlog of cases unless a new judge is appointed to fill a position which has been vacant for more than six months. Chief Justice Wayne Martin said he had been asking the Government to fill the vacancy created by Supreme Court judge Narelle Johnson's retirement last year. ... 'Any further significant delay in filling this position will affect the time at which we can deal with pending cases,' Justice Martin said in a response provided to The West Australian." 19I cannot say whether this matter would be heard more quickly in Western Australia than here. 20In the Commercial List of this Court, the Court's object is to give cases such expedition as their commercial imperatives require and to allocate such resources to cases as is necessary to achieve that object. 21I am not able to say, nor would it be appropriate for me to say, what the situation will be in Western Australia. It may well be the matter would be heard more quickly here than there. 22Even if I were able to reach a conclusion about that matter, it would be but one factor weighing on the issue. 23Every other factor points to the conclusion that the interests of justice would be served by having the proceedings transferred to Western Australia. 24First, as I have mentioned, the proceedings seem to have no connection at all with New South Wales. My attention has been drawn to the fact that on 8 February 2012 the solicitors acting for the plaintiff threatened to bring proceedings in the Supreme Court of Western Australia of the kind now brought here. 25Second, the project and operations of the parties of the dispute are located in the Pilbara in Western Australia. The project is conducted on tenure granted under Western Australian legislation. 26Third, all but one of the parties have their registered offices in Western Australia. The registered offices of the plaintiff and the first and second defendants are in Western Australia; that of the third defendant is in Hong Kong. No party has its registered office in New South Wales. 27Fourth, the relevant contracts have non-exclusive jurisdiction clauses nominating courts of Western Australia. Western Australian law governs the contracts. 28Fifth, there are two proceedings between the same parties on foot in the CMC List in Western Australia. I am informed one of those cases was heard very recently. There is another case between the same parties pending in the Federal Court in Western Australia. 29Sixth, the evidence shows that all, or almost all, of the witnesses that the defendants propose to call and the documents to be adduced by the defendants are in Western Australia. 30In all those circumstances, it appears to me the evidence points overwhelmingly to the conclusion that I should make the orders sought by the defendants. 31I make orders in paragraphs 1 and 2 of the Notice of Motion of 18 April 2013. ********** 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. Decision last updated: 01 May 2013