Reinsurance Australia Corporation Limited v HIH Casualty and General Insurance Ltd (in liqui [2002] FCA 1549 (21 November 2002)

Last Updated: 12 December 2002

FEDERAL COURT OF AUSTRALIA

Reinsurance Australia Corporation Limited v HIH Casualty and General Insurance Ltd (in liquidation) [2002] FCA 1549

REINSURANCE AUSTRALIA CORPORATION LIMITED (ACN 061 215 601) & MONEGASQUE DE REASSURANCES S.A.M. v HIH CASUALTY AND GENERAL INSURANCE (IN LIQUIDATION) (ACN 47 008 482 291), AIG EUROPE (UK) LTD AND NEW HAMPSHIRE INSURANCE COMPANY, HEATH GROUP LIMITED (FORMERLY CE HEALTH PLC), HEATH INSURANCE BROKING LTD FORMERLY CE HEATH (INSURANCE BROKING) LTD AND HEATH NORTH AMERICA AND SPECIAL RISKS LTD, ICE MEDIA LIMITED AND PREMIER MEDIA LIMITED & J P MORGAN CHASE BANK (FORMERLY KNOWN AS THE CHASE MANHATTAN BANK, FORMERLY KNOWN AS CHEMICAL SECURITIES INC)

N827 of 2002

JACOBSON J

SYDNEY

21 NOVEMBER 2002

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N827 OF 2002

BETWEEN:	REINSURANCE AUSTRALIA CORPORATION LIMITED ACN 061 215 601 FIRST APPLICANT MONEGASQUE DE REASSURANCES S.A.M. SECOND APPLICANT
AND:	HIH CASUALTY AND GENERAL INSURANCE (IN LIQUIDATION) ACN 47 008 482 291 FIRST RESPONDENT AIG EUROPE (UK) LTD AND NEW HAMPSHIRE INSURANCE COMPANY SECOND RESPONDENTS HEATH GROUP LIMITED (FORMERLY CE HEALTH PLC), HEATH INSURANCE BROKING LTD FORMERLY CE HEATH (INSURANCE BROKING) LTD AND HEATH NORTH AMERICA AND SPECIAL RISKS LTD THIRD RESPONDENTS ICE MEDIA LIMITED AND PREMIER MEDIA LIMITED FOURTH RESPONDENT J P MORGAN CHASE BANK (FORMERLY KNOWN AS THE CHASE MANHATTAN BANK, FORMERLY KNOWN AS CHEMICAL SECURITIES INC) FIFTH RESPONDENT
JUDGE:	JACOBSON
DATE OF ORDER:	21 NOVEMBER 2002
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. Leave is granted to file in Court the affidavit of L O Kolomyjec sworn on 21 November 2002, affidavit of L M Pring and the amended notice of motion of third respondent.

2. In accordance with paragraph 1 of the notice of motion of second respondent filed on 20 November 2002, at the hearing to commence on 25 November 2002 the testimony of Leslie Mark Pring be given from London by video link (s 47A of the Federal Court Act).

3. The applicant to pay the costs of the second respondent on this notice of motion. Costs of the other respondents to be costs in the cause.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N827 OF 2002

BETWEEN:

REINSURANCE AUSTRALIA CORPORATION LIMITED ACN 061 215 601 FIRST APPLICANT MONEGASQUE DE REASSURANCES S.A.M. SECOND APPLICANT

AND:

HIH CASUALTY AND GENERAL INSURANCE (IN LIQUIDATION) ACN 47 008 482 291 FIRST RESPONDENT AIG EUROPE (UK) LTD AND NEW HAMPSHIRE INSURANCE COMPANY SECOND RESPONDENTS HEATH GROUP LIMITED (FORMERLY CE HEALTH PLC), HEATH INSURANCE BROKING LTD FORMERLY CE HEATH (INSURANCE BROKING) LTD AND HEATH NORTH AMERICA AND SPECIAL RISKS LTD THIRD RESPONDENTS ICE MEDIA LIMITED AND PREMIER MEDIA LIMITED FOURTH RESPONDENT J P MORGAN CHASE BANK (FORMERLY KNOWN AS THE CHASE MANHATTAN BANK, FORMERLY KNOWN AS CHEMICAL SECURITIES INC) FIFTH RESPONDENT

JUDGE:	JACOBSON
DATE:	21 NOVEMBER 2002
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1 In the principal proceedings the applicants make substantial claims against five respondents in respect of alleged breaches of the Trade Practices Act 1974 (Cth) ("TPA"). The subject matter of the proceedings concerns a line of business which was reinsured by the applicants. The respondents have filed notices of motion seeking a stay of the proceedings essentially on the grounds that the Courts of Australia are a clearly inappropriate forum.

2 The evidence as I understand it will canvass in some detail the overlap between these proceedings and proceedings which are on foot in the United Kingdom and in New York. There are also affidavits which deal with questions of choice of law in particular as to whether claims under the TPA may be brought in either the UK Courts or the Courts of New York.

3 The application for a stay of the proceedings is to commence before me on Monday, 25 November 2002. I have before me this morning a notice of motion filed on behalf of the second respondents. The motion seeks an order that the evidence of Mr Leslie Mark Pring be given from London by way of video link in accordance with s 47A of the Federal Court of Australia Act 1976 (Cth). Mr Pring has sworn an affidavit in support of the motion. The affidavit discloses that Mr Pring is a partner in the London firm of solicitors of Denton, Wilde, Sapte. He says in the affidavit that he has the conduct of the matter on behalf of the second respondents.

4 Mr Pring sets out in the affidavit the reasons why he says it would be inconvenient for him to come to Australia to give evidence in person as is required by the applicants. Mr Pring says that the attendance in Sydney would be disruptive to his practice and in particular to a very substantial case which he is working on in London. That case involves a dispute in an amount of more than $US100 million. It relates to the financing of various films. Indeed, that is the line of business which is in issue in the principal proceedings before me.

5 Mr Pring says in his affidavit that there is a major case management conference which has been scheduled to take place in London on Friday, 29 November 2002. He says that at the case management conference his client will seek to have an application for summary judgment heard before the trial and that a substantial amount of preparatory work has to be done in advance of the management conference. No doubt counsel has been briefed but it seems clear enough to me from Mr Pring's affidavit that he will be giving a very large slice of his time to preparation of those proceedings during the period from at least Friday, 22 November 2002 up to the management conference which is due to take place on 29 November 2002.

6 The applicants have filed a short affidavit of Ms Lara Kolomyjec, a solicitor employed by the solicitors for the applicants in the proceedings. Ms Kolomyjec's affidavit sets out her inquiries as to the availability of flights from London to Sydney and also for return flights. Dr Bell of counsel who appeared for the applicants relies on this affidavit as some evidence that there would be Business Class availability on flights with British Airways which would enable Mr Pring to leave London on Friday evening and give his evidence in Sydney on Monday so as to enable him to return to London on Tuesday. The expectation is that he could be back in London on Tuesday morning. Dr Bell says that this schedule can be followed so as to prevent substantial inconvenience to Mr Pring.

7 Dr Bell also relies on two other matters in his opposition to the orders sought in the notice of motion. He says that the cross-examination of Mr Pring will take approximately two to three hours and that there will be a substantial number of documents to be shown to Mr Pring. Dr Bell says that this estimate has been given upon the basis that Mr Pring be present in person and that it may well take longer if Mr Pring has to be cross-examined on video link; this is because there are sometimes problems with the link and there may also be delays involved in showing Mr Pring a substantial number of documents.

8 Dr Bell concedes that there is no issue of credit but says that there will be substantial matters of challenge to Mr Pring's evidence. The evidence will deal with the overlap between the Australian proceedings and the proceedings in the UK and the United States and Mr Pring also gives in paragraph 105 of his affidavit an opinion to the effect that although there appears to be no English equivalent for relief under the TPA nonetheless whilst the first applicant would forfeit its right to damages it is difficult to perceive what damages the first applicant would be entitled to if found to be correct in the allegations which have been made.

9 Dr Bell says that this opinion, given upon the basis of a letter provided by Professor Bennett who is apparently not to be made available for cross-examination, will be challenged and that it would be preferable for the challenge to take place in person rather than by way of video link.

10 The cases establish that I have a discretion to exercise which of course must be exercised judicially. In a recent decision of Tamberlin J in Versace v Monte [2001] FCA 1454, his Honour said at [16]:

"[G]iven the advanced state of video link technology and also because of the convenience of the procedure and the savings in time and cost a substantial case needs to be made out to warrant the Court declining to make an order for evidence to be taken by video link."

11 His Honour referred with approval to a decision of Katz J in Tetra Pak Marketing Pty Ltd v Musashi Pty Ltd [2000] FCA 1261. Tamberlin J set out a passage which appears in Katz J's judgment at [25]. There, Katz J referred to a strong current of authority in favour of permitting video link technology to be used in the absence of some considerable impediment telling against it.

12 Dr Bell has referred me to a number of other authorities including a decision of Palmer J in a matter of Australian Medical Imaging Pty Ltd v Marconi Medical Systems (Australia) Pty Ltd [2001] NSWSC 651; (2001) 53 NSWLR 1. I have also been referred to a decision of Spender J in Australian Competition & Consumer Commission v World Netsafe Pty Ltd [2002] FCA 526 in which his Honour seems to take a slightly different approach from that of Katz J. Spender J referred at [7] to the deficiencies when evidence is taken by video link compared with evidence given viva voce and he referred to criticisms made by Giles CJ Commercial Division in Sunstate Airlines (Qld) Pty Ltd v First Chicago Australia Securities Ltd (Supreme Court of New South Wales, 11 March 1997, unreported). There, his Honour referred to the conduct of proceedings in open court being available for public scrutiny and said that cross-examination may be more difficult when video evidence is taken because documents have to be transmitted or produced in an unfamiliar manner.

13 I have taken all of these matters into consideration and it does seem to me that in the present case I ought to exercise my discretion in favour of the evidence being taken by way of video link. I have raised with counsel for the second respondents the proposed establishment of a video link at 9 o'clock on Monday morning and he has indicated that he will do his best to ensure that he co-operates with the applicant to enable the video link to commence at 9 o'clock on Monday, 25 November. This seems to me to meet one of Dr Bell's objections which was that there was no assurance given that Mr Pring would be available to give evidence at a suitable time consistent with the timetable for the taking of evidence which he handed up to me this morning.

14 I've taken into account the fact that in the motions which I will be hearing next week Mr Pring's credit is not in issue and that seems to me to be a factor which distinguishes this motion from the matters which were dealt with in particular by Palmer J in the Supreme Court and also by Spender J. Whilst there may be some delays due to the difficulties involved in providing documents to the witness in London it does seem to me that the logistics can be put in place to enable that aspect of the evidence to be dealt with smoothly. I've also taken into account the fact that the cross-examination is likely to be longer than an hour or so which the cases seem to say is the optimal time for cross-examination by way of video.

15 This is a major piece of litigation but the issue before me is really, at least on Monday's hearing, only concerned with the question of whether the Court is a clearly inappropriate forum for the hearing of the principal proceedings.

16 In those circumstances it seems to me that I ought to make an order in accordance with paragraph 1 of the notice of motion.

17 I also propose to order that the applicants pay the costs of the second respondents of this motion and that the costs of the other respondents be costs in the cause.

I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jacobson.

Associate:

Dated: 11 December 2002

Counsel for the Applicants:	Mr J Gleeson SC, Dr A Bell & Mr J K Kirk
Solicitor for the Applicants:	Phillips Fox
Counsel for the First Respondent:	Mr N Hutley SC & Mr M Speakman
Solicitor for the First Respondent:	Blake Dawson Waldron
Counsel for the Second Respondent	Dr I J Hardingham QC & Mr M W Thompson
Solicitor for the Second Respondent:	Herbert Geer Rundle
Counsel for the Third Respondents:	Mr R Douglas QC & Mr Rich
Solicitor for the Third Respondents:	Clayton Utz
Counsel for the Fourth Respondents:	No appearance
Counsel for the Fifth Respondent:	Mr T Bathurst QC & Mr A Payne
Solicitor for the Fifth Respondent:	Allens Arthur Robinson
Date of Hearing:	21 November 2002
Date of Judgment:	21 November 2002