Ssabr Pty Ltd v AMA Group Ltd

[2021] NSWSC 1497

Supreme Court

New South Wales

Medium Neutral Citation:

SSABR Pty Ltd v AMA Group Ltd [2021] NSWSC 1497

Hearing dates:

12 November 2021

Decision date:

12 November 2021

Jurisdiction:

Equity - Commercial List

Before:

Stevenson J

Decision:

Application to transfer proceedings to the Supreme Court of Victoria refused

Catchwords:

CIVIL PROCEDURE – Cross-vesting – Transfer to other Supreme Court – application under Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) to transfer proceedings to Supreme Court of Victoria – whether it is in the interests of justice that that Court is the more appropriate

Legislation Cited:

Competition and Consumer Act 2010 (Cth), Sch 2 – Australian Consumer Law

Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth)

Cases Cited:

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

Joshan v Pizza Pan Group Pty Ltd [2021] NSWCA 219

Spiliada Maritime Corporation v Cansulex Ltd [1986] 3 All ER 843; [1987] AC 460

Category:

Procedural rulings

Parties:

SSABR Pty Ltd (First Plaintiff/Respondent)
HAAPRC Pty Ltd (Second Plaintiff/Respondent)
AMA Group Limited (First Defendant/Applicant)
AMA Group Solutions Pty Ltd (Second Defendant/Applicant)

Representation:

Counsel:
J Redwood SC with S Hill (Plaintiffs/Respondents)
M A Robins QC with S Fitzpatrick (Defendants/Applicants)

Solicitors:
CBD Law (Plaintiffs/Respondents)
Nicholson Ryan Lawyers (Defendants/Applicants)

File Number(s):

2021/257009

Judgment – EX TEMPORE

1. These proceedings were commenced on 8 September 2021.

2. The plaintiffs conducted two smash repair businesses in West Gosford. By a Business Sale Agreement dated 3 October 2018, the plaintiffs sold those businesses to the first defendant.

3. The Business Sale Agreement provided for an initial cash payment and an "Earn-out amount".

4. The proceedings concern:

1. the proper construction of the Business Sale Agreement;

2. the plaintiffs’ contentions as to terms to be implied into the Business Sale Agreement;

3. the defendants’ contentions that a clause in the Business Sale Agreement ought to be rectified; and

4. the plaintiffs’ contentions that the defendant has engaged in misleading or deceptive conduct for the purpose of s 18 of the Australian Consumer Law. [1]

   1. Competition and Consumer Act 2010 (Cth), Sch 2 – Australian Consumer Law.

5. By Notice of Motion dated 15 October 2021, the defendants seek an order under s 5 of the Jurisdiction of Courts (Cross-vesting) Act1987 (Cth) that these proceedings be transferred to the Supreme Court of Victoria.

6. The relevant principles are succinctly set out in the submissions of Mr Robins QC, who appears with Mr Fitzpatrick for the defendant:

“(a)   The question is whether it appears to this Court that it is ‘in the interests of justice’ that the proceeding be determined by the Supreme Court of Victoria: s. 5(2)(b)(iii) of the Act. That is an evaluative, rather than discretionary, question as to which is the ‘more appropriate’ forum: BHP Billiton Ltd v Schultz (2004) 221 CLR 400; [2004] HCA 61 [14] per Gleeson CJ, McHugh and Heydon JJ, [77] per Gummow J.

(b)   An applicant for a transfer bears no burden of persuasion or onus of proof: Schultz [71]: and no significance attends the plaintiff’s original choice of forum: Schultz [25]-[27] per Gleeson CJ, McHugh and Heydon JJ; [77] per Gummow J.

(c)   The ‘more appropriate’ forum will ordinarily be the jurisdiction ‘with which the action has the most real and substantial connection’, based on objective factors: Schultz [170] per Kirby J; see also [19] per Gleeson CJ, McHugh and Heydon JJ. Such factors include:

i.   the law governing the relevant transaction: Schultz [18] per Gleeson CJ, McHugh and Heydon JJ (citing Spiliada Maritime Corporation v Cansulex Limited [1986] 3 All ER 843; [1987] AC 460 at 478 per Lord Goff);

ii.   the location of the subject matter and actionable conduct: James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357; [2000] NSWCA 353;

iii.    the location and availability of witnesses: Schultz [18] per Gleeson CJ, McHugh and Heydon JJ (citing Spiliada at 478 per Lord Goff); and

iv.    where parties reside or carry on business (with some emphasis on the location of the defendant): Schultz [19] per Gleeson CJ, McHugh and Heydon JJ.

(d)   Moreover, the interests of justice are not divorced from the ‘practical reality’: Schultz [15] per Gleeson CJ, McHugh and Heydon JJ.”

7. To that summary I would add the further observations of the plurality in Schultz that "[i]t is both necessary and sufficient that, in the interests of justice, the second court is more appropriate". [2]

   2. At [14].

8. I am not satisfied that the Victorian Supreme Court is a "more appropriate" Court than this Court for the determination of the issues in these proceedings.

9. The following factors are at play:

1. the plaintiff companies have their registered office and place of business in NSW;

2. the case concerns a dispute about the sale of businesses that were and, as I understand it, are still being conducted in West Gosford in New South Wales;

3. the dispute about the "Earn-out amount" will be an accounting exercise but based upon the performances of the businesses in West Gosford;

4. the plaintiffs are in effect "one-man companies" whose director, Mr Nercessian, will be its main, if not only, lay witness and who lives near the Central Coast in New South Wales;

5. the first defendant on the other hand is a large publicly listed company that owns and operates smash repair businesses throughout Australia including 66 in Victoria and a further 116 elsewhere in Australia and New Zealand;

6. the plaintiffs will also call its accountant, Mr Viera, who also lives on the Central Coast;

7. the plaintiffs will also call a forensic accountant, Mr Morris, who lives in Adelaide and thus has no relevant connection to Victoria;

8. the plaintiffs’ solicitor is in Gosford and their counsel are from Sydney (although these factors are neutral as the defendants’ legal team is in Melbourne);

9. the defendants’ currently identified lay witnesses are no longer employed by the defendant and do not live in Victoria: Mr Hopkins lives in Western Australia, and the other, Mr Harding-Smith, is in Queensland;

10. the defendants may call their now Chief Financial Officer, Mr Thorley, and Chief Operating Officer, Mr Cooper, although that decision has not yet been made; both those gentlemen live in Melbourne;

11. another possible lay witness, Mr Timmus, identified in the List Statement as being involved in an allegedly misleading or deceptive representation to Mr Nercessian, is no longer employed by the defendants and evidently his whereabouts are not currently known to the defendants; and

12. the defendants’ counsel and solicitors are in Melbourne and, as I have said, that is a neutral factor.

10. Further, the Business Sale Agreement is expressed to be governed by the law of Victoria. However, with one exception, there was no suggestion made in the submissions to me that the law in Victoria is relevantly different to that in New South Wales.

11. The one exception is that suggested by Mr Robins, that Courts of Appeal in New South Wales and Victoria have expressed differing views about the law concerning the implication of an implied term to act in good faith.

12. I think it is fair to say that that submission was not agitated with much enthusiasm by Mr Robins. In any event, a trial judge in this Court is as well-equipped as one in the Supreme Court of Victoria to navigate such shoals as may exist there.

13. The Business Sale Agreement also contains a clause in which the parties submit to the non-exclusive jurisdiction of the Victorian courts. Mr Robins accepted that this factor is not of great weight especially in light of the recent decision of the Court of Appeal in Joshan v Pizza Pan Group Pty Ltd [3] in which Bell P noted that non-exclusive jurisdiction clauses are given little or no weight in cross-vesting cases. [4]

    3. [2021] NSWCA 219.

    4. At [84].

14. This case concerns a dispute about the sale of a business in New South Wales.

15. There are nine witnesses currently identified; two live in New South Wales, three in Victoria, one in South Australia, one in Queensland and one in Western Australia. The whereabouts of the other is not known.

16. When all these factors are weighed up, I am not persuaded that the Supreme Court of Victoria is a more appropriate forum for the resolution of this dispute nor that Victoria is the jurisdiction with which the action has "the most real and substantial connection".

17. I order that the defendants’ Notice of Motion of 15 October 2021 be dismissed with costs.

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Endnotes