Supreme Court New South Wales Medium Neutral Citation: Fuji Xerox Australia Pty Ltd v Documents on Call Pty Ltd [2018] NSWSC 1862 Hearing dates: 3 December 2018 Date of orders: 05 December 2018 Decision date: 05 December 2018 Jurisdiction: Common Law Before: Harrison J Decision: Notice of motion dismissed with costs Catchwords: CIVIL PROCEDURE – cross-vesting – transfer to other Supreme Court – where non-exclusive jurisdiction clause Legislation Cited: Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW), s 5 Cases Cited: Asciano Services Pty Ltd v Australian Rail Track Corp Ltd [2008] NSWSC 652 BHP Billiton Ltd v Schultz (2004) 221 CLR 400; [2004] HCA 61 James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357; [2000] NSWCA 353 Patrick Badges Pty Ltd v Commonwealth of Australia [2002] NSWSC 221 Taurus Funds Management Pty Ltd v Aurox Resources Ltd [2010] NSWSC 1223 Category: Procedural and other rulings Parties: Fuji Xerox Australia Pty Ltd (Plaintiff/Respondent) Documents on Call Pty Ltd (First Defendant/Applicant) Kevin James Mack (Second Defendant/Applicant) Mary Denise Mack (Third Defendant/Applicant) Representation: Counsel: D F Elliott (Plaintiff/Respondent) G S J Berlic (Defendants/Applicants) Solicitors: Gillis Delaney Lawyers (Plaintiff/Respondent) Wisewould Mahony Lawyers (Defendants/Applicants) File Number(s): 2018/258941 Publication restriction: Nil Judgment 1. HIS HONOUR: The defendants move the Court by notice of motion filed on 6 September 2018 for an order pursuant to s 5(2) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 that the proceedings be transferred to the Supreme Court of Victoria. The order is opposed. For the reasons that follow, I think that the notice of motion should be dismissed with costs. Background 1. The first defendant is a printing company with premises in Footscray in Melbourne. Its directors are the second and third defendants. The plaintiff's registered office is in Sydney although it also has an office in Melbourne. Between 5 July 2014 and 12 October 2015, the plaintiff supplied the first defendant with printing equipment and supplies pursuant to eight separate equipment lease agreements. 2. By its statement of claim, the plaintiff alleges that the first defendant failed to pay amounts due to it in accordance with invoices issued pursuant to these various agreements. The second and third defendants guaranteed the first defendant's obligations under them. The defendants do not appear in significant ways to dispute the plaintiff's claims but do contend that they have a cross-claim by way of set off, as well as a claim for damages, arising from what is alleged to be a series of representations upon which they relied to their detriment. These representations relate principally to the characteristics and capacity of the FX 1400 Controller machine supplied by the plaintiff and to the plaintiff's continuing obligations to the first defendant concerning it. 3. The plaintiff has not yet filed a defence to the cross-claim. In the normal course of events it might be expected that the plaintiff will require further and better particulars of that cross-claim. As the matter now stands, the parties have not yet prepared or exchanged evidence in the form of witness statements or expert reports. These things appear to me to be relevant to my consideration of the present application. This is referred to later in these reasons. 4. The relevant legal principles are not in doubt: see, for example, BHP Billiton Ltd v Schultz (2004) 221 CLR 400; [2004] HCA 61 at [14] and [19] and James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357; [2000] NSWCA 353 at [95]. In the latter case, the following factors were endorsed as being relevant to determining where the interests of justice might lie for the purposes of s 5(2)(b)(iii) of the Act: 1. The application of substantive law. 2. Any forensic advantage or detriment conferred by procedural law. 3. The choice made by a plaintiff of a forum and the reasons for that choice. 4. Any substantive connections with the forum. 5. The balance of convenience to parties and witnesses. 6. The convenience to the court system. 1. The defendants supported their application with the following contentions. 2. First, it is submitted that the events giving rise to these proceedings all occurred in Victoria. All the agreements and the guarantees were executed and signed by the plaintiff in Melbourne. All pre-contractual negotiations and dealings occurred in Melbourne. The equipment and supplies which are the subject of these proceedings were supplied at the first defendant's premises or otherwise elsewhere in Victoria. All servicing carried out on the equipment by the plaintiff was carried out at the first defendant's premises in Melbourne. All demonstrations of the operation of the FX 1400 carried out by the second defendant, at the plaintiff's request, and for the purpose of its marketing of that product, were carried out at the first defendant's premises in Melbourne. Finally, until the plaintiff restructured its internal administration in or about 2014, payments were made and received by cheque in Melbourne. 3. The plaintiff's head office is in Sydney. However, the defendants submitted that given the above connections with Victoria, this should be given little weight in determining where the dispute's real and substantial connection lies. 4. Secondly, the defendants maintain that the majority of witnesses live in Victoria. That contention is said to be based "on the circumstances currently known to the defendants, as well as the indications from the [plaintiff's] affidavit of Raymond Perkes". The defendants submitted that it "appears that 11 of the 13 witnesses for both [the plaintiff] and [the first defendant] live in Victoria". It is also suggested that only "two potential witnesses live in New South Wales". 5. The defendants submitted that in the absence of any compelling reason to maintain the proceedings in New South Wales, it would be contrary to the interests of justice for the parties to incur additional costs associated with transporting and accommodating witnesses from Victoria, including the second and third defendants, or to cause them the resulting or associated inconvenience in doing so. 6. The defendants also contended that the relative inconvenience would be greater for them. That would include the need for the second and third defendants to be present in Sydney for the duration of the hearing and the requirement for them to close their business for that time. Accordingly, even if the trial were to proceed for only five days, as the plaintiff's solicitor has suggested, this would result in closure of the business for one week causing greater inconvenience and expense for the defendants. In contrast, the plaintiff is a large corporation which could more easily absorb the financial and administrative inconvenience of arranging for any of its current employees to attend the proceedings in Victoria and for a representative to attend each day at the trial. That is said to be especially so having regard to the fact that the plaintiff also has an office in Melbourne. The defendants perceive as well that the plaintiff is likely to have a greater ability to absorb the cost and disruption of attending a trial in Melbourne. 7. Finally, and somewhat curiously, the defendants submitted that if the proceedings were transferred to Victoria, they would be heard in the Supreme Court of Victoria's Commercial Court, a suitably specialised forum, in which a single judge would be allocated to manage the proceedings. This was said by the defendants for some reason to be preferable. Unsurprisingly, this submission was not pressed following a short discussion between me and counsel for the defendants. Consideration 1. Clause 13(j) in the relevant agreements is in these terms: "This Agreement and all matters arising out of or relating to it are governed by the laws of New South Wales. Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts of New South Wales." 1. Clause 2 of the relevant guarantees provides as follows: "This Guarantee and all matters arising out of or relating to it are governed by the laws of New South Wales. Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts of New South Wales." 1. The plaintiff relied upon these provisions in its response to the present application. In determining requests to transfer proceedings under the cross-vesting scheme, courts have given weight, but not necessarily primacy, to clauses such as these: they are persuasive but not conclusive. Each case will depend upon its own particular circumstances. 2. In Patrick Badges Pty Ltd v Commonwealth of Australia [2002] NSWSC 221 at [14], Howie J said: "[14] I doubt that it is necessary under the cross-vesting legislation to determine whether such a clause is an exclusive jurisdiction clause or not. Provided that the clause can be construed as being a substantive term of the agreement between the parties as to the likely jurisdiction for the determination of disputes under the agreement, it should be given weight in the determination of where the 'interests of justice' lie. It would be a factor, possibly of significance when consideration is given to the weight to be accorded to the inconvenience of a particular party, that the party entered into an agreement under which dispute resolution would, prima facie at least, take part in a particular and possibly inconvenient jurisdiction." 1. In Asciano Services Pty Ltd v Australian Rail Track Corp Ltd [2008] NSWSC 652, Palmer J considered the significance of a choice of law clause coupled with a choice of forum clause (which was not expressed to be exclusive) in the following terms: "[18] However, regardless of whether a proper law and jurisdiction clause confers exclusive jurisdiction, it carries great weight in determining the appropriate forum in a cross-vesting application because it records a term of the bargain between the parties that litigation arising from their agreement will be resolved in accordance with the substantive law of a specified forum and by the courts of that forum: see, for example, per Howie J in Patrick Badges Pty Ltd v Commonwealth [2002] NSWSC 221, at [23]. Particularly persuasive is the weight of such a clause in a contract between commercial parties well able to protect their respective interests. [19] In my opinion, the provisions of cl 21 in the present case as to the governing law of the Track Access Agreement and as to the courts in which disputes shall be determined are dispositive of the application. Whether or not cl 21.2 confers exclusive jurisdiction on the South Australian courts, the parties themselves have given a strong indication in that clause of where and under what law their disputes should be tried, regardless of the inconveniences which may be occasioned to either or both of them." 1. In Taurus Funds Management Pty Ltd v Aurox Resources Ltd [2010] NSWSC 1223 at [38], Einstein J said: "[38] The fact that parties have expressly consented to the non-exclusive jurisdiction of the Supreme Court of New South Wales in respect to disputes arising out of the Equity Mandate should be regarded as a critical and decisive factor in determining that the Supreme Court of New South Wales is a more appropriate forum than the Supreme Court of Western Australia. When considering any inconvenience to Aurox by reason of the proceeding having been commenced in this Court, it is important to recognise that Aurox expressly agreed to proceedings being brought in this Court, and irrevocably submitted to its jurisdiction. Moreover, that choice of forum clause appears in the contract which, on Aurox's pleading, governs the rights and obligations of the parties at the relevant time in relation to the introduction of any equity partner." 1. The jurisdiction and choice of law clauses are important aspects of the agreements in question in these proceedings. The defendants suggested that some significance attached to the fact that they appear in what seem to be pro forma contracts. There is, however, no suggestion that the defendants entered into these agreements, or that the second and third defendants proffered their guarantees, without legal advice about them or an appreciation of what they contained. There has been no suggestion that the contracts are attended with some vitiating unfairness. It seems reasonably clear on the evidence before me that the defendants contracted on the basis that the resolution of disputes would take place in a particular and possibly even inconvenient jurisdiction. 2. I do not consider in the known circumstances of this case that there is any basis for either diluting or discarding the operation of these clauses. The parties appear to have contracted at arm's length. I accept that the plaintiff is a large commercial entity with considerable commercial experience and influence in the printing industry. That is not standing alone a reason why the terms of its contracts should be modified in favour of its customers. Indeed, the size and reputation of the plaintiff seem likely to be among some of the advantages the defendants enjoyed in dealing with the plaintiff. Acceptance of its standard terms and conditions does not automatically work any discernible injustice upon the defendants in the context of the geographical inconvenience associated with responding to process issued out of this Court. It is important as well to observe that the laws of this State and the procedures of this Court do not create any difficulties that would not be associated with litigation in Victoria. 3. In my opinion, these clauses are sufficient to dispose of the present application. However, quite apart from my view about the need to give effect to these provisions, I would otherwise have dismissed this application on discretionary grounds. Transfer of the proceedings to the Victorian Supreme Court is not in the interests of justice. 4. The defendants' major concern is that they anticipate that they face a hearing exceeding one week with manifold witnesses who will be required to travel from Victoria and elsewhere at unnecessary and avoidable expense and with similarly expensive disruptions to their business. I have already noted that the parties have not exchanged statements of evidence so that the precise number of witnesses or their location is unknown. So too is the content of any prospective witnesses' evidence and the related information about whether they will be required for cross-examination. For all I know at present, the issues may be far narrower than the defendants have suggested and the length of the trial may be much shorter than the defendants predict. The prospect that the evidence of witnesses, other than the second and third defendants who are parties, could be taken by audio visual link, without doing injustice to any party, was doubted by counsel for the defendants but no meaningful or principled basis for that opposition was shown. The notion that judges cannot adequately assess the credibility of witnesses, or that counsel cannot effectively cross-examine them, when they appear on a screen as opposed to in a witness box seems to me to find its support in long gone romantic perceptions of litigation that have little if any place in the modern era. It may be just, but it is seldom quick or cheap. It also flies in the face of daily experience in this Court and elsewhere in the resolution of contested civil and criminal disputes. The idea that video evidence is a degraded form of receiving critical evidence is a mere ipse dixit without any reasoned or principled foundation. 5. Nor does the fact that the events that give rise to these proceedings occurred predominantly in Victoria seem to me to make any relevant contribution to this contest. Evidence about these matters will inevitably be taken in the form of statements. The precise or even general location of these events is unlikely to play any significant role in deciding this case, if it plays any role at all. The defendants have not suggested that a view or inspection or demonstration on site will be required for a proper understanding of how the printer is alleged to have fallen short of expectations or contractual requirements. Metropolitan courts across this country regularly deal with rural and remote issues without the need to move to these locations to do so. This is either a neutral factor or an insignificant one. 6. Without the benefit of knowing what parties will call what witnesses on what issues, and where the differences will lie, it is simply not possible to predict how long the hearing of these proceedings will take. Disruption and inconvenience of any type and howsoever measured is necessarily a function of that assessment. I remain somewhat sceptical that the hearing will take as long as the defendants pessimistically suggest. That remains to be seen. The pleadings have not closed at this stage and mediation has also obviously not yet been explored. Conclusion 1. It will be apparent that in my view, the present application is without merit. It should be dismissed with costs. ********** Amendments 05 December 2018 - Catchwords amended 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: 05 December 2018