District Court New South Wales Medium Neutral Citation: Giuseppe Citterio Salumficio SPA v Zintix (Australia) Pty Ltd ACN 143376952 [2019] NSWDC 89 Hearing dates: 01 March 2019 Date of orders: 01 March 2019 Decision date: 01 March 2019 Jurisdiction: Civil Before: Judge Robert Montgomery Decision: 1) On or before Monday 11 March 2019, the cross claimant is to serve an affidavit: explaining its failure to comply with orders made 23 November 2018 for service of expert evidence of foreign law. a) Explaining its failure to amend the cross claim to specifically plead the law of its set off claim. b) Informing the Court of when it will serve expert evidence on the foreign law of the transaction and the forum of jurisdiction in final form as would be relied upon in the final hearing. 2) Time for service of evidence, referred to in 1(b), to be not later than Monday 1 April 2019. 3) I direct the cross claimant to file and serve any amended cross claim on or before 12 April 2019. 4) In the event of substantial failure by the cross claimant to comply with these orders, the stay of Judgment obtained by the plaintiff on 23 November 2018 will be vacated. 5) The cross claimant pay the cross defendants costs of today, 1 March 2019. 6) In the event that the cross claimant seeks variation of orders 1-5 above, it must proceed by Notice of Motion supported by affidavit evidence served on the cross defendant not later than Monday 8 April 2019. 7) I return the matter before me for Readiness Hearing on Thursday 18 April 2019 in expectation that the parties will join in a timetable toward fixing a date for hearing save that in the event of failure to agree then such timetable as will be ordered. 8) I return the matter for mention before me 10am Friday 15 March 2019. Catchwords: PLEADINGS - Foreign Law [UCPR r 14.14]; EXPERT EVIDENCE - Foreign Law [ss 174-176 Evidence Act 1995 (NSW)] Legislation Cited: Evidence Act 1995 (NSW); Uniform Civil Procedure Rules 2005 (NSW) Category: Procedural and other rulings Parties: Giuseppe Citterio Salumficio SPA Zintix (Australia) Pty Ltd ACN 143376952 Representation: Counsel: Mr D Aquilina (Plaintiff/Cross Defendant) Mr Y Chen (Defendant/Cross Claimant) Solicitors: Tomaras Lawyers (Plaintiff/Cross Defendant) SR Law (Defendant/Cross Claimant) File Number(s): 2016/00380628 Publication restriction: None Judgment 1. HIS HONOUR: In the matter of Giuseppe Citterio Salumificio SPA v Zintix (Australia) Pty Limited I delivered a reasoned judgment and made directions on 1 November 2018. The purpose of the reasons was to bring efficiency to proceedings which, in my opinion, had been inadequately brought in how they were pleaded and in the absence to comply with the provision for expert evidence where foreign law is the substance of the dispute. Each party failed as is required to plead specifically the foreign law. In this case broadly I will say the law of Italy but I have nothing before me about it and therefore do not determine it to be the law of Italy; it indeed may be the law of a particular jurisdiction within that foreign nation which applies to the transaction sued upon. 2. Following my judgment and my raising the question of foreign law with the parties, it was agreed that the law of Italy, in the sense which I have described and not more specifically than that, applies. The directions which I gave were designed to encourage the parties to perfect their pleadings with the opportunity of having obtained expert opinion on the law relating to the transaction such that the real issues in dispute could be best identified and the law of the foreign nation identified. In addition, and not insignificantly, I directed the parties to attend to the question of forum. 3. In fact, the matter was before the Court on Notices of Motion by each party seeking orders, including orders for security for costs. In the circumstance I have just identified, no party had presented to the Court in a competent way the real issues in dispute and therefore the prospects of success. That said, the plaintiff being a foreign entity without any presence in Australia, the defendant's Notice of Motion for security for costs presented on a strong basis. It would, however, be quite inappropriate for a defendant to achieve an order for security for costs in a proceeding in which it might ultimately be that this jurisdiction is not the available forum. That is because through their ignoring of the question of jurisdiction and the question of law applicable to the dispute, as well as the rules of evidence, each of the parties had ignored the fundamental proposition of what law and what forum applied. 4. A consequence of the judgment of 1 November 2018 and the orders I made was that the plaintiff conceded a debt to the defendant on the Statement of Claim. I confess to having encouraged the parties to agree the sum in Australian dollars when it was at least available that the debt should be in euros. This was because in order to get to the nuts and bolts of the matter whether or not the defence and cross-claim, which made like complaint, were viable should have been readily resolved and remained the only issue between the parties. In other words, it was hoped that in a cost effective and efficient way a commercial resolution might have been achieved by agreement or determination. In particular the questions of forum, jurisdiction and foreign law are likely to be determinative of whether or not interest can be claimed. Judgment has been entered for the plaintiff against the defendant in the not inconsiderable sum of $281,702.42. 5. In the judgment of 1 November 2018 I said this: "Succinctly the proposition is, at least as far as I understand it from today, the exhibited document dated 3 May 2011 according to Italian law, as would be applied in the Court of Milan, imposed in terms of the supply contract and/or trade between the plaintiff and the defendant, being a provision for six months' notice of termination. The plaintiff has failed to provide that notice and the defendant ought to be entitled to its loss of trade by a cross-claim to be set off against the principal debt and about which there is apparently no dispute. Further, if the terms of trade according to the law of Italy, as it would be applied in the forum of the Court of Milan, of the supply between the plaintiff and the defendant/cross-claimant came to be terms of payment by running account; then what those terms would be, as determined by the law of Italy would be applied as in the Court of Milan. The second proposition is immediately relevant to when the debt, if any, became due and what interest, if any, is payable." 1. After that time there has been a frank admission of the debt in agreement with my reasons. The issues remaining are only those on the cross-claim concerning the alleged variation of the supply contract. 2. My judgment included the preliminary view that given the document upon which the cross-claimant/defendant principally relied is not a document made between the plaintiff and the Italian supplier, that being the supply contract, it was difficult to see that under the law of this jurisdiction it could have caused there to be a variation of the terms of that supply contract. 3. In these circumstances it is a matter of great concern that the matter having returned to the Court with the parties agreeing to attend to the steps required to have the matter ready on or about 23 November 2018, that now on 1 March 2019 the cross-claimant has not completed any of the following: Firstly, the obtaining of expert evidence on the law of the transaction going to the variation of terms of trade pleaded in the cross-claim in the form of a setoff; and secondly, the logical step which would be expected to follow with the benefit of that advice, of amending the cross-claim so as to properly plead according to the law of Italy that cause for relief from the debt and basis for setoff. 4. The Court's hands for the taking of action are, to some extent, hesitant whilst, as was confirmed today, there is disagreement as to whether the forum for the dispute is in the place referred to in the contracts, being a jurisdiction within the nation of Italy, or within this jurisdiction. The obvious and serious concern is that the cross-claimant is dragging its feet and has failed to comply with its obligations for pleading and the specific directions of the Court in relation to the expert evidence. There is an admission of debt. In the circumstances the stay against enforcement of that debt, being a debt in favour of the plaintiff owed by the defendant/cross-claimant and agreed in this jurisdiction and these proceedings, should not remain to linger to the disadvantage of the plaintiff. 5. Another consideration is that the cross-defendant ought not be put to completion of its expert evidence on the law of the dispute in the cross-claim prior to the cross-claimant having, in accordance with the Rules, properly pleaded that cause of action by amendment of the cross-claim and with the normal forensic opportunity of having seen the expert evidence of the cross‑claimant before serving its own expert evidence on the question. In those circumstances there is not more that the cross-defendant can do and it is entirely unacceptable that a debtor in this jurisdiction is holding these proceedings in such limbo. 6. For those reasons I make the following orders: 1. On or before Monday 11 March 2019, the cross claimant is to serve an affidavit: explaining its failure to comply with orders made 23 November 2018 for service of expert evidence of foreign law. 1. Explaining its failure to amend the cross claim to specifically plead the law of its set off claim. 2. Informing the Court of when it will serve expert evidence on the foreign law of the transaction and the forum of jurisdiction in final form as would be relied upon in the final hearing. 1. Time for service of evidence, referred to in 1(b), to be not later than Monday 1 April 2019. 2. I direct the cross claimant to file and serve any amended cross claim on or before 12 April 2019. 3. In the event of substantial failure by the cross claimant to comply with these orders, the stay of Judgment obtained by the plaintiff on 23 November 2018 will be vacated. 4. The cross claimant pay the cross defendants costs of today, 1 March 2019. 5. In the event that the cross claimant seeks variation of orders 1-5 above, it must proceed by Notice of Motion supported by affidavit evidence served on the cross defendant not later than Monday 8 April 2019. 6. I return the matter before me for Readiness Hearing on Thursday 18 April 2019 in expectation that the parties will join in a timetable toward fixing a date for hearing save that in the event of failure to agree then such timetable as will be ordered. 7. I return the matter for mention before me 10am Friday 15 March 2019. ********** 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: 04 April 2019