Treasureway Stores Pty Ltd v Yorke [1982] FCA 9; (1982) 59 FLR 222 (5 February 1982)

FEDERAL COURT OF AUSTRALIA

TREASUREWAY STORES PTY. LTD. v. YORKE [1982] FCA 9; (1982) 59 FLR 222
Appeal - Practice

COURT

FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
Fox(1), McGregor(1), Elicott(1) JJ.

CATCHWORDS

Appeal - Appeal against dismissal of application for stay of proceedings - Whether court should interfere - Principles.

Practice - Application for stay of proceedings - Application dismissed - Appeal - Whether court should interfere - Principles. In July 1981 the male respondent commenced proceedings in the Supreme Court of South Australia against the appellant alleging, inter alia, fraudulent misrepresentation in breach of the Misrepresentation Act, 1971-1972 (S.A.). In August 1981 he instituted proceedings in the Federal Court of Australia alleging breaches of ss. 52 and 59(2) of the Trade Practices Act 1974 (Cth). In October 1981 the appellant commenced proceedings against the respondents in the Supreme Court of South Australia seeking declaratory orders and injunctive relief in relation to a bill of sale. The appellant then applied to the Federal Court for a stay of the proceedings in that court which had been commenced in August 1981. The application having been dismissed in the first instance the appellant appealed to the Full Court of the Federal Court of Australia.

Held, per curiam, that, as the application for a stay of proceedings called for an exercise of discretion by the trial judge, the Full Court should be hesitant to interfere and should only do so if the exercise of the discretion had miscarried because of the trial judge's application of a wrong principle or otherwise. In the instant case there was no such error as should involve the intervention of the Full Court and the appeal should therefore be dismissed.

McHenry v. Lewis (1882), 21 ChD 202; Re Will of Gilbert (deceased) (1946), 46 SR (NSW) 318; Dougherty v. Chandler (1946), 46 SR (N.S.W.) 370; Hughes Motor Service Pty. Ltd. v. Wang Computer Pty. Ltd. [1978] FCA 49; (1978), 35 FLR 346; Muller v. Fencott [1981] FCA 129; (1981), 53 FLR 184; Reynolds v. Reynolds (1977), 35 FLR 232, referred to.

HEARING

ADELAIDE, 1982, February 5. 5:2:1982
APPEAL.

Appeal from a decision of the Federal Court of Australia (Fisher J.) to the Full Court of that court.

A. Cunningham, for the appellant.

S. Haarsma, for the respondents.

Solicitors for the appellant: Camatta Lempens & Cashen.

Solicitors for the respondents: Haarsma Womersley & Co.
E. F. FROHLICH

DECISION

FEBRUARY 5.

Fox J. delivered the following ex tempore judgment of the court.
In this matter the court has already announced its decision, having in mind

the time situation. I will now give the reasons of the court for its decision. (at p223)

2. Treasureway Stores Pty. Ltd., which I shall call Treasureway, appeals from the whole of the judgment of Fisher J. given on 24th November, 1981, in matter S.A. G. 38 of 1981, wherein the learned judge dismissed an application for a stay of proceedings in the action by Treasureway. It will be convenient to refer to the parties by the same abbreviations as did the learned judge at first instance. It appears from the judgment and evidence to be common ground that: 1. On 30th July, 1981, after certain preliminary applications, the male applicant commenced proceedings No. 2206 of 1981 in the Supreme Court against Treasureway, and against the respondent to the proceedings in this Court, viz. Kevin Thomas Mahoney, said to be a director of a company, Ross Lucas Pty. Ltd., which had acted as a servant or agent of Treasureway. The male applicant in the said proceedings alleged fraudulent misrepresentation, a cause of action pursuant to ss. 6 and 7 of the Misrepresentation Act 1971-1972 (S.A.), breach of contract and negligent misrepresentation in respect of the purchase of the lease and goodwill of a record and retailing business owned by the applicant known as Treasureway Records, of which Treasureway had been the proprietor. 2. On 21st August, 1981, proceedings, S.A. G. 38 of 1981, were commenced by the applicants against Ross Lucas Pty. Ltd. and Ross Melville Lucas. Pursuant to an order of Fisher J. made on 29th September, 1981, Treasureway and Kevin Thomas Mahoney were added as respondents. In these proceedings it is alleged that certain representations were made in relation to and preceding the execution by the male applicant of a certain contract note, and that they were untrue. It is said that the alleged untrue representations constituted conduct which was misleading or deceptive, or likely to mislead or deceive contrary to s. 52 of the Trade Practices Act 1974 (Cth), as amended, and false or misleading contrary to s. 59(2) of the said Act. In the said action damages and other relief as the court should deem fit are sought. 3. On 23rd October, 1981, Treasureway commenced proceedings No. 3132 of 1981 in the Supreme Court of South Australia against the applicants, seeking certain declaratory orders and injunctive relief in relation to the bill of sale registered No. 533973, in respect of which it was alleged, first, that no payments had been made, and second, that certain stock in trade had been allowed to fall below a certain figure contrary to conditions in the said bill of sale. In this action, no particulars, at the date the judgment appealed from was given, had been filed, although it is said they are being settled by counsel and though interlocutory orders have been made. (at p223)

3. In the judgment appealed from, his Honour said: "The current position in each of these proceedings is as follows: the Supreme Court proceedings by the male applicant were commenced after certain preliminary applications in that court on 30th July, 1981, and it was contended that they could be heard at the earliest towards the middle of next year. In the other Supreme Court proceedings commenced on 23rd October, 1981, by Treasureway, a statement of claim has not yet been filed, although a number of interlocutory orders have been made. The proceedings in this Court were commenced on 21st August, 1981, and were set down for hearing on 1st December, 1981." (at p224)

4. After reference to counsel's arguments and authorities cited, his Honour decided for reasons he gave that Treasureway had not by its evidence satisfied him that it would incur substantially less inconvenience and expense if the issues were litigated in the Supreme Court of South Australia. Further, he decided that in the particular circumstances of these proceedings the applicants would, were the stay granted, be deprived of legitimate personal and juridical advantages, including, it seems, an early trial of issues in which all parties, against whom the applicants contend they have a right to recover, are respondents. He said he was not satisfied that remedies in respect of contraventions of the Trade Practices Act 1974 were equally available in the Supreme Court proceedings. (at p224)

5. He concluded that the applicants were likely to be disadvantaged if not permitted to proceed with the hearing of the action as then fixed, that is for 1st December, 1981. He also rejected the arguments for Treasureway as to its cross action, and its claim on the bill of sale. He expressed the opinion that no matter which side might succeed in this Court, the probabilities were that the applicants' action in the Supreme Court would not proceed, at least to the extent it was based on allegations of misrepresentation. (at p224)

6. He was not satisfied that the application for a stay was one which properly should be granted, and in the exercise of his discretion rejected it. (at p224)

7. Counsel for Treasureway, which is the only appellant before us, contends that the decision below was incorrect, and that the stay should have been then, and should now, be granted. As the decision appealed from was an exercise of a discretion, and in relation to a matter of procedure, it is agreed that this Court should be hesitant to interfere, and should only do so if because of the application of a wrong principle or otherwise, the exercise of the discretion has miscarried. (at p224)

8. We have listened with attention to the careful argument of counsel for the appellant, but are not satisfied that there was any such error as should involve the intervention of this Court. On the contrary, we are of the view that his Honour's conclusion was clearly the correct one, and substantially for the reasons he has given. (at p224)

9. The case is in essence one in which the respondents to this appeal have sought relief in relation to the same factual situation in two courts, the Supreme Court of South Australia and this Court. The South Australian proceedings were commenced first, but in those proceedings reliance could not be placed on the provisions of the Trade Practices Act. The present proceedings are based on provisions of that Act and are not the same causes of action as those pleaded in the South Australian action. There are more parties to these proceedings, consistently with the provisions of the Act. (at p225)

10. We agree with the view that the applicants in the action in this Court should not be allowed by commencing those proceedings to engage in vexatious or oppressive conduct. A number of cases touch upon the principles involved (McHenry v. Lewis (1882) 21 ChD 202 and (1882) 22 ChD 397 ; Re Will of Gilbert (deceased) (1946) 46 SR (NSW) 318 ; Dougherty v. Chandler (1946) 46 SR (NSW) 370 ; Hughes Motor Service Pty. Ltd. v. Wang Computer Pty. Ltd. [1978] FCA 49; (1978) 35 FLR 346 ; Muller v. Fencott [1981] FCA 129; (1981) 53 FLR 184 ; cf. Waddell J. in Reynolds v. Reynolds (1977) 33 FLR 232). (at p225)

11. Much turns on the facts of each situation. The present appellant does not seek a perpetual stay but only one until the South Australian action including any consequent appeals is concluded. It has not been suggested that the respondents to the appeal should be put to an election. (at p225)

12. It is sought to delay the hearing of the action in this Court, which is set down for next Monday, until after the South Australian action is determined, and we understand that it is unlikely that the hearing of that action can commence before about August next. Depending upon the result, the respondents might still wish to proceed in this Court. (at p225)

13. On the other hand, it seems quite likely that the action in this Court based on ss. 52 and 59 of the Trade Practices Act will finally resolve the principal issue between the parties. That action is ready to proceed. As we have already noted, the other respondents to that action are not pressing for a stay and have appeared before us by counsel to say that they abide the order of the court. (at p225)

14. The time element is especially important, bearing in mind the fact that the injunction obtained by the appellant against the respondents continues in operation. On the one hand is the effect of that injunction, and on the other is the undertaking in certain circumstances to pay damages resulting therefrom. It is argued that the time element should be discarded because an expedited hearing might have been obtained in the Supreme Court. The fact is that none has been sought, and interlocutory matters in the Supreme Court action have not been finalized. (at p225)

15. The total situation, in our view, greatly favours the continuation of the present action. (at p226)

16. We therefore are of the view that the appeal should be dismissed with costs. (at p226)

ORDER

The order of the court is that the appeal be dismissed, with costs.
. . .

We note that counsel withdraws the application made by way of notice of

motion for security of costs, and that motion is dismissed accordingly.