Multiplex Funds Management Limited v P Dawson Nominees Pty Limited

• Jurisdiction: Australia Federal only
• Judgment Date: 21 December 2007
• Neutral Citation: [2007] FCAFC 200
• Court: Full Federal Court (Australia)

FEDERAL COURT OF AUSTRALIA

Multiplex Funds Management Limited v P Dawson Nominees Pty Limited

[2007] FCAFC 200

PRACTICE AND PROCEDURE – Representative proceedings under Pt IVA of the Federal Court of Australia Act 1976 (Cth) – application by respondent for order under s 33N(1) of the Act that proceeding no longer continue as a representative proceeding under Pt IVA – criterion for membership of group that persons have entered a litigation funding agreement with particular funder – construction of paras (a), (b), (c) and (d) of s 33N(1) discussed – whether “policy” underlying Pt IVA can be identified and should be taken into account – whether criterion for membership of group inconsistent with Pt IVA

Held: Primary Judge’s decision that presence of criterion not inconsistent with Pt IVA and that order under s 33N(1) should not be made upheld.

Federal Court of Australia Act 1976 (Cth) ss 33C(1), 33N(1)

Braverus Maritime Inc v Port Kembla Coal Terminal (2005) 148 FCR 68 cited

Bright v Femcare Ltd (2002) 195 ALR 574 discussed

Dorajay Pty Ltd v Aristocrat Leisure Ltd (2005) 147 FCR 394 discussed

Jameson v Professional Investment Services Pty Ltd [2007] NSWSC 1437 discussed

Knight v FP Special Assets Limited (1992) 174 CLR 178 cited

O’Sullivan v Challenger Managed Investments Limited [2007] NSWSC 383 referred to

P Dawson Nominees Pty Ltd v Multiplex Ltd [2007] FCA 1044 cited

P Dawson Nominees Pty Ltd v Multiplex Ltd [2007] FCA 1061 followed

PMT Partners Pty Limited (in liq) v Australian National Parks and Wildlife Service (1995) 184 CLR 301 cited

Rod Investments (Vic) Pty Ltd v Clark [2005] VSC 449 discussed

Wong v Silkfield Pty Ltd (1999) 199 CLR 255 cited

Zhang v Minister for Immigration, Local Government and Ethnic Affairs (1993) 45 FCR 384 cited

Australian Law Reform Commission Report No 46: Grouped Proceedings in the Federal Court (1988)

Morabito V, “Class actions instituted only for the benefit of the clients of the class representative’s solicitors” (2007) 29 Sydney Law Review 5

MULTIPLEX FUNDS MANAGEMENT LIMITED (ACN 105 371 917) v

P DAWSON NOMINEES PTY LIMITED (ACN 004 743 408) AND MULTIPLEX LIMITED (ACN 008 687 063)

VID 692 of 2007

MULTIPLEX LIMITED (ACN 008 687 063) v P DAWSON NOMINEES PTY LIMITED (ACN 004 743 408) AND MULTIPLEX FUNDS MANAGEMENT LIMITED (ACN 105 371 917)

VID 693 of 2007

FRENCH, LINDGREN AND JACOBSON JJ

21 DECEMBER 2007

MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
vICTORIA DISTRICT REGISTRY	VID 692 of 2007

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	MULTIPLEX FUNDS MANAGEMENT LIMITED (ACN 105 371 917) Appellant
AND:	P DAWSON NOMINEES PTY LIMITED (ACN 004 743 408) First Respondent MULTIPLEX LIMITED (ACN 008 687 063) Second Respondent
JUDGES:	FRENCH, LINDGREN AND JACOBSON JJ
DATE:	21 DECEMBER 2007
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1. The appellant be granted leave to appeal.

2. The appeal be dismissed.

3. The appellant pay the costs of the first respondent.

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

IN THE FEDERAL COURT OF AUSTRALIA
vICTORIA DISTRICT REGISTRY	VID 693 of 2007

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	MULTIPLEX LIMITED (ACN 008 687 063) Appellant
AND:	P DAWSON NOMINEES PTY LIMITED (ACN 004 743 408) First Respondent MULTIPLEX FUNDS MANAGEMENT LIMITED (ACN 105 371 917) Second Respondent
JUDGES:	FRENCH, LINDGREN AND JACOBSON JJ
DATE:	21 DECEMBER 2007
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1. The appellant be granted leave to appeal.

2. The appeal be dismissed.

3. The appellant pay the costs of the first respondent.

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

IN THE FEDERAL COURT OF AUSTRALIA
vICTORIA DISTRICT REGISTRY	VID 692 of 2007

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	MULTIPLEX FUNDS MANAGEMENT LIMITED (ACN 105 371 917) Appellant
AND:	P DAWSON NOMINEES PTY LIMITED (ACN 004 743 408) First Respondent MULTIPLEX LIMITED (ACN 008 687 063) Second Respondent
JUDGES:	FRENCH, LINDGREN AND JACOBSON JJ
DATE:	21 DECEMBER 2007
WHERE MADE:	MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
vICTORIA DISTRICT REGISTRY	VID 693 of 2007

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	MULTIPLEX LIMITED (ACN 008 687 063) Appellant
AND:	P DAWSON NOMINEES PTY LIMITED (ACN 004 743 408) First Respondent MULTIPLEX FUNDS MANAGEMENT LIMITED (ACN 105 371 917) Second Respondent
JUDGES:	FRENCH, LINDGREN AND JACOBSON JJ
DATE:	21 DECEMBER 2007
WHERE MADE:	MELBOURNE

REASONS FOR JUDGMENT

FRENCH J:

1 I agree for the reasons given by Jacobson J that the appeal should be dismissed with costs. There may be policy questions, for consideration by the legislature, relating to the role of litigation funders in representative proceedings. The Court is given a discretion under s 33N(1)(d) to order that a proceeding no longer continue under Pt IVA of the Federal Court of Australia Act 1976 (Cth) where it is satisfied that it is in the interests of justice to do so because “… it is otherwise inappropriate that the claims be pursued by means of a representative proceeding”. The broad evaluative judgment permitted by the term “otherwise inappropriate” is not, in my opinion a charter to introduce a quasi legislative rule effectively excluding from representative proceedings groups defined by reference to accession to an agreement with a litigation funder.

I certify that the preceding one (1) numbered paragraph is a true copy of the Reasons for Judgment herein of the Honourable Justice French.

Associate:

Dated: 21 December 2007

IN THE FEDERAL COURT OF AUSTRALIA
vICTORIA DISTRICT REGISTRY	VID 692 of 2007

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	MULTIPLEX FUNDS MANAGEMENT LIMITED (ACN 105 371 917) Appellant
AND:	P DAWSON NOMINEES PTY LIMITED (ACN 004 743 408) First Respondent MULTIPLEX LIMITED (ACN 008 687 063) Second Respondent
JUDGES:	FRENCH, LINDGREN AND JACOBSON JJ
DATE:	21 DECEMBER 2007
WHERE MADE:	MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
vICTORIA DISTRICT REGISTRY	VID 693 of 2007

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	MULTIPLEX LIMITED (ACN 008 687 063) Appellant
AND:	P DAWSON NOMINEES PTY LIMITED (ACN 004 743 408) First Respondent MULTIPLEX FUNDS MANAGEMENT LIMITED (ACN 105 371 917) Second Respondent
JUDGES:	FRENCH, LINDGREN AND JACOBSON JJ
DATE:	21 DECEMBER 2007
WHERE MADE:	MELBOURNE

REASONS FOR JUDGMENT

LINDGREN J:

INTRODUCTION

2 I have had the benefit of reading the reasons for judgment of Jacobson J for which I am grateful. I agree with his Honour that the appeals should be dismissed and I agree generally with his Honour’s reasons for reaching that conclusion. I wish, however, to add the following observations with reference to the issues identified by his Honour. (I will use the abbreviated terms that appear in his Honour’s reasons for judgment.)

CONSIDERATION Issue 1 – the relationship between s 33C(1) and s 33N(1)

3 With respect, I do not think that the submissions of either the Multiplex parties or Dawson adequately represent the relationship between s 33C(1) and s 33N(1) of the Act.

4 The words “Subject to this Part” in s 33C(1) do not indicate that the s 33N(1) considerations somehow qualify the right given by s 33C(1) to commence a proceeding, so that, for example, the right to commence a proceeding does not exist if “all the relief sought can be obtained by means of a proceeding other than a representative proceeding under [Pt IVA]” (s 33N(1)(b)). Section 33N(1) refers to the Court’s being “satisfied” that it is in the interests of justice that the proceeding “no longer continue” under Pt IVA because of one of the reasons specified. Such concepts cannot be applied to the anterior right to commence the proceeding.

5 It is not as though the words “Subject to this Part” must incorporate a reference to s 33N(1) of the Act in order to have work to do. There are other provisions within Pt IVA that do modify or clarify the right to commence a proceeding given by s 33C. For example, s 33E(1) provides that the consent of a person to be a group member is not required, but s 33E(2) provides that none of the persons specified in that subsection is a group member in a representative proceeding unless that person gives written consent to being so. Section 33G provides that a representative proceeding may not be commenced in the circumstances described in that section. There are other provisions designed to ensure that s 33C is given an ample construction; see, for example, ss 33D(1) and s 33F(1).

6 On the other hand, while the words “Subject to this Part” in s 33C(1) do not signify that the commencement of a proceeding can be denied statutory authority by reference to the s 33N(1) considerations, that subsection, on its own terms and without reference to the words “Subject to this Part,” gives the Court a discretion to order that a proceeding no longer continue under Pt IVA on the grounds identified. I see no reason why those grounds should be understood to be limited by reference to post-commencement developments. Indeed, the grounds will usually, although not necessarily, be established by facts that existed when the proceeding was commenced, although they may only have become clear afterwards.

Issue 2 – s 33N(1)(d) and the definition of a group that satisfies s 33C(1)

7 In Bright v Femcare Ltd (2002) 195 ALR 574 (Bright v Femcare) I said (at [74]) that s 33N(1)(a)–(d) raise practical questions that require that the Pt IVA proceeding in question be compared with other proceedings that are available to the applicant and group members as a means of resolving...