HNOE Limited v Angus & Julia Stone Pty Ltd

1. [1]

   BELL CJ: This is an application for leave to appeal from a decision of Nixon J (the primary judge) sitting in the Commercial List of the Supreme Court of New South Wales.

2. [2]

   His Honour had before him a notice of motion filed on 15 March 2024 by the Defendants which sought a permanent stay of proceedings, and further and alternatively, that claims against two of the Defendants, Manton Music Management Pty Ltd (MMM) and Timothy Manton (Mr Manton), be summarily dismissed and that certain paragraphs of the Commercial List Statement (CLS) be struck out.

3. [3]

   As will appear below, questions of principle were raised by the application for leave to appeal. Leave to appeal should in all the circumstances of the case be granted.

Background

1. [4]

   The Plaintiffs (Respondents in this Court) are Angus Stone, Julia Stone, “Angus & Julia Stone Pty Ltd” (collectively, the Stones), and three other companies of which Mr Stone and Ms Stone are directors (the related companies). Mr Stone and Ms Stone are Australian musical performers who resided in New South Wales and Victoria respectively during the relevant period: PJ [115].

2. [5]

   On 14 August 2015, the Stones entered into a management agreement (the Management Agreement) with HNOE Limited (HNOE) which is the first defendant in the proceedings and, together with MMM and Mr Manton, are the defendants to the Commercial List proceedings and the Applicants in this Court. HNOE is a London-based talent agency incorporated under the laws of England and Wales: PJ [2]. The Management Agreement was executed in California.

3. [6]

   The related companies were not parties to the Management Agreement, nor were MMM and Mr Manton although Mr Manton is referred to in it. He is an artist manager, residing in New South Wales and the sole director of MMM, a company incorporated in Australia: PJ [6].

4. [7]

   The Management Agreement provided that:

5. [8]

   The Management Agreement also contained cl 12.11 which was in the following terms:

6. [9]

   Nixon J held that the second half of this clause was in the nature of an exclusive jurisdiction clause or exclusive choice of court clause, as such clauses are sometimes described: Angus & Julia Stone Pty Ltd v HNOE Limited [2024] NSWSC 627 at [176] (primary judgment or PJ). There was no challenge to this characterisation of cl 12.11.

7. [10]

   Prior to the Management Agreement being entered into, on 4 October 2013, MMM and HNOE entered an agreement (the MMM Agreement) whereby MMM undertook for Mr Manton to provide “artist management services as the lead manager of Angus & Julia Stone”: PJ [7]. In return, MMM was entitled to invoice HNOE for 50% of commissions received by HNOE with respect to the Stone parties: PJ [59]. The Stones were not parties to this agreement and neither MMM nor Mr Manton was a party to the Management Agreement.

8. [11]

   There was evidently an earlier agreement between Julia Stone and “Julia Stone Pty Ltd” (the Third and Sixth Plaintiffs) and Mr Manton made on or about 12 March 2013 by which Mr Manton was appointed the exclusive manager of the Third and Sixth Plaintiffs’ activities in the music industry (the Manton Julia Agreement). No reference was made to this agreement in the original CLS, filed on 31 January 2024, although it was referred to in subsequent iterations of the CLS although in none of those iterations was it alleged to have been breached nor is it alleged that any commission payments were made under it.

9. [12]

   The “Nature of the Dispute” as described by the Plaintiffs in the original CLS was said to be as follows:

10. [13]

    Paragraph 31 of the original CLS was to this effect:

11. [14]

    Notwithstanding that the Stones had commenced the Commercial List proceedings against HNOE in breach of the exclusive jurisdiction clause in the Management Agreement, the proceedings included parties (plaintiffs in the form of the related companies and defendants in the form of MMM and Mr Manton) who were not parties to the exclusive jurisdiction clause or the Management Agreement although it may be observed that what claims the related companies had, and what claims lay against MMM and Mr Manton, did not emerge from the description of the nature of the dispute in the original CLS.

12. [15]

    The existence of these other claims and parties, however, was why the summary dismissal/strike out aspect of the notice of motion was strategically so important for, if the claims against MMM and Mr Manton were summarily dismissed or struck out, there would have been a powerful case for granting a permanent stay of proceedings by reason of the exclusive jurisdiction clause, in accordance with well established authority: see Karpik v Carnival plc [2023] HCA 39; (2023) 98 ALJR 45 at [66] (Karpik); Akai Pty Ltd v People’s Insurance Company Ltd (1996) 188 CLR 418 at 427-429, 445; [1996] HCA 39 (Akai); Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 at 224, 259; [1988] HCA 32 (Oceanic); Global Partners Fund Ltd v Babcock & Brown Ltd (in liq) [2010] NSWCA 196; (2010) 79 ACSR 383 (Global Partners); Australian Health & Nutrition Association Ltd v Hive Marketing Group Pty Ltd (2019) 99 NSWLR 419; [2019] NSWCA 61 at [76]-[78] (Hive). The summary dismissal of the breach of statutory duty claims, especially those against Mr Manton and MMM, would have significantly diminished the existence of any “strong countervailing reasons” (Karpik at [66]) for not giving effect to the exclusive jurisdiction clause by a stay of the proceedings.

13. [16]

    The primary judge was confronted with something of a moving feast. The notice of motion attacked the original CLS. In the course of the hearing of the notice of motion on 1 May 2024, it became tolerably clear, as will be explained below, that a key component of the Plaintiffs’ claims alleging a breach of s 11 of the Entertainment Industry Act 2013 (NSW) (EI Act) disclosed no cause of action. Further evidence (in the form of the MMM Agreement) and submissions were filed by the Plaintiffs on 6 May which attached a proposed amended CLS (Draft ACLS) which sought to introduce a claim for breach of statutory duty, the relevant statute being the EI Act. The Draft ACLS also introduced a reference to the Manton Julia Agreement but did not allege that it had been breached and in [29], being the claim for breach of statutory duty, the only particulars of commissions charged in respect of which damages or restitution was sought were commissions charged by HNOE.

14. [17]

    The Stones’ submissions and the Draft ACLS were the subject of responsive submissions by the Defendants on 10 May and a further reply by the Plaintiffs on 14 May 2024. His Honour, with admirable despatch, delivered reasons on 24 May 2024.

15. [18]

    In the event, the primary judge dismissed the notice of motion seeking a stay of proceedings but held that there were deficiencies in the Plaintiffs’ claims in the CLS and Draft ACLS. As such, his Honour ordered that the Plaintiffs “file any application for leave to amend the Summons and/or the Commercial List Statement by 7 June 2024”: PJ [186(1)]. As to the Manton Julia Agreement, the primary judge held at PJ [98] that it was:

16. [19]

    An amended form of CLS, filed in accordance with his Honour’s orders and differing from the Draft ACLS, was placed before this Court on the hearing of the application for leave to appeal even though it had not been before the primary judge. It is convenient to refer to it as the Filed ACLS. It represented a further iteration of the proposed pleading by the Plaintiffs and reference will be made to it in considering whether a stay should be granted on the re-exercise of discretion if it be the case that error be found in the approach of the primary judge, and in particular the failure summarily to dismiss the breach of statutory duty aspect of the claim which was at the heart of the argument in this Court.

17. [20]

    Mr Flynn SC who, with Mr Beshara, appeared for the Applicants submitted that the Filed ACLS must be taken to represent the Plaintiffs’ best attempt to formulate their breach of statutory duty claim after full argument at first instance. It would not have been in keeping with s 56 of the Civil Procedure Act 2005 (NSW) (Civil Procedure Act) to remit the matter to the primary judge to consider the Filed ACLS in circumstances where argument had been fully prepared for the purposes of this application for leave to appeal. A similar pragmatic approach was adopted by Wood CJ at CL, hearing an appeal from a decision of Master Harrison refusing to strike out an action for breach of statutory duty, in Preston v Star City Pty Ltd [1999] NSWSC 1273 at [2]-[3] (Preston).

18. [21]

    At the heart of the argument in this Court was the primary judge’s refusal to strike out or summarily dismiss the Stones’ claims of breach of statutory duty. Importantly, the primary judge noted (at PJ [154]) that:

19. [22]

    Before turning to the primary judge’s reasoning, it is necessary to set out some key provisions of the EI Act.

The Entertainment Industry Act

1. [23]

   Section 11(1) which was at the heart of the Plaintiffs’ claims provides:

2. [24]

   “Performer” is defined in s 4 of the EI Act as “any actor, singer, dancer, acrobat, model, musician or other performer of any kind who enters an entertainment industry agreement with a performer representative”. An “entertainment industry agreement” is defined in s 4 as “an agreement between a performer and a performer representative to provide one or more of the services referred to in section 5”.

3. [25]

   Section 5 of the EI Act defines “performer representative” and the relevant services as follows:

4. [26]

   As noted above, s 11(1) of the EI Act prohibits performer representatives from charging performers under an “entertainment industry agreement” rates which exceed the “capped amount”, subject to the exception set out in the balance of the provision.

5. [27]

   The “capped amount” is defined by s 9(1)(a) of the EI Act as “the percentage, prescribed by the regulations, of the total amount payable to the performer for any performance in respect of which the performer representative provided services under an entertainment industry agreement”.

6. [28]

   Regulation 4(1) of the Entertainment Industry Regulation 2020 (NSW) provides that:

7. [29]

   Schedule 1 to the EI Act is a code of conduct, cl 2(8) of which provides:

8. [30]

   Section 20 of the EI Act provides:

9. [31]

   An “entertainment industry representative” is defined in s 4 of the EI Act to mean a performer representative or a venue representative.

10. [32]

    Sections 21 and 22 of the EI Act empowers the Secretary to accept and enforce undertakings by entertainment industry representatives for suspected contraventions of the Act.

11. [33]

    Sections 24 and 25 of the EI Act should also be noted. Section 24 provides that:

12. [34]

    Section 25 provides that:

13. [35]

    Also of relevance to the breach of statutory duty argument is s 43(1)-(2) of the EI Act, which provides:

14. [36]

    Section 39 of the EI Act should also be noted. It provides that:

The EI Act claim

1. [37]

   Paragraph 29 of the original CLS was in the following terms:

2. [38]

   Reliance on ss 6 and 9 of the EI Act was abandoned.

3. [39]

   The Draft ACLS addressed deficiencies in the way the claim in relation to the EI Act was pleaded by reframing it as a tortious claim for breach of statutory duty. Thus the “re-pleaded” [29] of the proposed Draft ACLS was in these terms:

4. [40]

   In the Filed ACLS, [29] was further amended as follows:

5. [41]

   The Particulars to these amended paragraphs was in the same form as the Particulars to [29] of the original CLS reproduced at [37] above. Schedule C was in identical form in each case, headed “HNOE Excess Commission Charges” and claimed the same amount. Importantly, the Particulars and Schedule C referred only to “commissions charged by HNOE”. No reference was made in these particulars or anywhere else in either the Draft ACLS or the Filed ACLS to any commissions having been paid under the Manton Julia Agreement. Of particular note, the Filed ACLS made no attempt to identify “the amounts demanded or paid under the [Manton Julia] agreement and the dates on which those demands and payments were made”, contrary to the direction of the primary judge: see [18] above.

The primary judgment in relation to the EI Act claims

1. [42]

   The now Applicants advanced a number of arguments at first instance and on appeal attacking the Respondents’ EI Act claims. These included that these claims were not available against MMM and Mr Manton because neither of them was a party to the Management Agreement or indeed any agreement with the Stones so that they could not have been in breach of s 11 of the EI Act, still less have committed the tort of breach of statutory duty, because s 11 required a demand or receipt of a fee or other remuneration from a performer under an entertainment industry agreement.

2. [43]

   The Applicants also argued that the EI Act was not engaged because neither demand nor receipt of commissions occurred in New South Wales, and the EI Act was not intended to have extra-territorial operation. Reference was made in this context to this Court’s decision in DRJ v Commissioner of Victims Rights (No 2) (2020) 103 NSWLR 692; [2020] NSWCA 242.

3. [44]

   The more fundamental argument advanced by the Applicants, however, and one that, if correct, supplied a complete answer to the claims made for breach of statutory duty against all Defendants including HNOE was that, on the proper construction of the EI Act, no such private law action for breach of statutory duty was available.

4. [45]

   The primary judge noted the following principles in respect of the Court’s power summarily to dismiss proceedings:

5. [46]

   As already noted at [21] above, the primary judge accepted that whether or not an action for breach of statutory duty was available involved the interpretation of the EI Act, was not a question that would be influenced by any factual finding and admitted of only one correct answer: PJ [154].

6. [47]

   The primary judge summarised the competing contentions of the parties. His Honour noted the Applicants’ contention that “there is a clear legislative intent not to grant such a right … apparent from the rights which are (and which are not) created by the EI Act” (at [147]), “that one sees in the EI Act is a deliberate legislative attempt to confer very limited and specific rights of enforcement upon a performer and that this legislative intention negates any other, more general, rights being conferred on performers by the EI Act by implication”(at [151]) and noted the following two authorities to which it will be necessary to return: Sovar v Henry Lane Pty Ltd (1967) 116 CLR 397 at 405; [1967] HCA 31 (Sovar); Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410 at 424; [1995] HCA 24 (Byrne).

7. [48]

   His Honour’s summary of the Plaintiffs/Respondents’ position was as follows:

8. [49]

   The core of his Honour’s reasoning was set out in the following paragraphs:

Consideration

1. [50]

   It will have been observed that there were two strands to his Honour’s reasoning. The first was set out in PJ [157], namely his Honour’s view that, having regard to the parties’ competing contentions, there was a debatable question of law.

2. [51]

   In General Steel, Barwick CJ said at 130 that:

3. [52]

   The emphasised portion of this passage was quoted with approval by Gummow and Hayne JJ, albeit in dissent on the facts, in Jackamarra (an Infant) v Krakouer (1998) 195 CLR 516; [1998] HCA 27 at [35] (Jackamarra). Referring to the issue of whether a matter was “arguable”, their Honours had said that:

4. [53]

   This aspect of their Honours’ judgment was referred to in Boensch v Pascoe (No 2) [2017] FCA 146 at [27]-[30] per Gleeson J, in Longreach Family Living (Vic) Pty Ltd v Simonds Homes Melbourne Pty Ltd [2013] VSCA 274 at [56] and in in de Braekt v Legal Profession Complaints Committee [2016] WASCA 220 at [43]-[44].

5. [54]

   In Spencer at [55], Hayne, Crennan, Kiefel and Bell JJ, having referred to General Steel, said that “the test to be applied was one of demonstrated certainty of outcome”.

6. [55]

   In Lepcanfin Pty Ltd v Lepfin Pty Ltd (2020) 102 NSWLR 627; [2020] NSWCA 155 at [96]-[99], Payne and McCallum JJA agreed with the following observations made by me in that case:

7. [56]

   The question raised as to the availability of an action for breach of statutory duty in the current case did not involve any issues of fact or of mixed fact and law, nor did it depend on “propositions of law apparently precluded by existing authority” nor was it submitted that acceptance of the Applicants’ attack on the claim for breach of statutory duty would stultify the development of the law: Spencer at [25].

8. [57]

   Moreover, although the primary judge referred to the parties’ competing contentions as giving rise to a debatable question of law, the Stones’ position as set out in PJ [152]-[153] and reproduced at [48] above, comprised two paragraphs referring to two relevant High Court decisions and then recorded a submission that was essentially conclusory.

9. [58]

   In my respectful opinion, in the unusual circumstances of this case where no issues of fact were involved and it was common ground that there was only one answer to the question of statutory construction, that question was capable of resolution on a summary basis, and, as I shall seek to show, there was real utility in answering it. The fact that argument, even of an extensive kind, may be necessary to demonstrate that the case of the Plaintiffs for breach of statutory duty was so clearly untenable that it could not succeed, should not stand in the way of its resolution, consistent with Sir Garfield Barwick’s observations in General Steel to which attention has been drawn. It might also be ventured that, in the unusual circumstances of this case where there was only one correct answer the identification of which was a pure question of law, s 56 of the Civil Procedure Act also favours such a course. Considerations of the kind which inform that section were made explicit by Gummow and Hayne JJ in Jackamarra.

10. [59]

    Consistent with the above approach, in Preston at [93], Wood CJ at CL upheld an appeal from the Master and struck out on a summary basis claims for breach of statutory duty on the basis that those claims were untenable. True it is that the engagement of the summary jurisdiction is one to be exercised with caution but that is not to deny its existence in an appropriate case. Contrary to the primary judge’s intimation, the fact that no separate question was pursued (even if the discretion to order a separate question had been exercised) was not a reason why the summary jurisdiction was not available and should not have been exercised.

11. [60]

    The EI Act confers no relevant express private cause of action for breach of s 11(1) of the Act. That is the necessary starting point for the analysis. Accordingly, if such a cause of action is available, it can only arise by a process of implication from the subject matter, scope and context of the Act.

12. [61]

    Where no private right of action has been created, the legislature not having expressed any intention on the subject, Sir Owen Dixon observed that “an interpretation of the statute, according to ordinary canons of construction, will rarely yield a necessary implication positively giving a civil remedy”: O'Connor v S P Bray Ltd (1937) 56 CLR 464 at 477-478; [1937] HCA 18 (O’Connor) (emphasis added). So much was reaffirmed by Gummow J in Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1; [1999] HCA 59 at [157]. See also Porter v OAMPS Ltd [2005] FCA 232; (2005) 215 ALR 327 at [110].

13. [62]

    Dixon J in O’Connor, having pointed to some cases in this area which he politely suggested were informed by “… very general considerations without either the authority of any general rule of law or the application of any definite rule of construction”, went on to attempt to formulate his understanding of the true nature of the principle. Thus, he said at 478 that:

14. [63]

    Two matters may be observed about this passage. First, it may be doubted that any “wider rule” has been deduced in the almost 90 years since O’Connor apart, perhaps, from Kitto J’s observation in Sovar which focussed the interpretative inquiry on what may be inferred from the nature, scope and terms of the statute. Secondly, an important aspect of Dixon J’s formulation was that any implied statutory duty would generally exist adjacent to an existing common law duty of care. Kitto J emphasised this aspect in his decision in Sovar at 404-405; see also Anderson v Mackellar County Council (1968) 69 SR (NSW) 444 at 448 per Jacobs JA; Pask v Owen [1987] 2 Qd R 421 at 427 per Andrews CJ; Jane Doe v Fairfax Media Publications Pty Limited [2018] NSWSC 1996 at [117], [138] (Jane Doe) per Fullerton J. Pausing there, in relation to the present case, no pre-existing duty of care was said to be owed by a promoter to an artist in relation to the charging of commission, that traditionally being a matter determined contractually. This tends against the existence of any statutory duty: Askin v Knox [1989] 1 NZLR 248 at 253; Willis v Castelein [1993] 3 NZLR 103 at 113; Field v Dettman [2013] NSWCA 147 at [44] (Field); see also C Sappideen et al, Fleming’s The Law of Torts (11th ed, 2024) at [16.20].

15. [64]

    The fact that the Respondents may have fallen within a class of persons to whom the EI Act or aspects of it was directed does not compel an affirmative answer to the existence of an action for breach of statutory duty: Preston at [81], citing Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 67-68; [1981] HCA 50; Jane Doe at [126], citing King v Goussetis (1986) 5 NSWLR 89.

16. [65]

    In Byrne, a case involving whether an action for breach of statutory duty arose from breach of an enforceable industrial award, McHugh and Gummow JJ held at 461 that “[t]he existence of rights conferred by the legislation to recover payments due under awards and the power of the court to order payment of penalties tend against the proposition that, from the nature, scope and terms of the legislation, there arises the further inference that damages are recoverable.”

17. [66]

    Perhaps the clearest guidance as to whether a private action for breach of statutory duty was intended by the legislature is the analysis of Jordan CJ in Martin v Western District of Australasian Coal and Shale Employees' Federation Workers' Industrial Union of Australia (Mining Department) (1934) 34 SR (NSW) 593 at 596 (Martin), a decision cited with approval by Dixon J in O’Connor. The Chief Justice identified as the “most important” matter pointing against the existence of such an intention as “the provision by the statute which creates the new duty of a special means for its enforcement” noting that “[w]here a special means is so provided, the general rule is that the performance of the duty cannot be enforced in any other manner: Pasmore v Oswaldtwistle Urban District Council ([1898] AC 387, at p. 394); and prima facie there is no other remedy”. Pasmore was cited with approval by McHugh and Gummow JJ in Bailey v New South Wales Medical Defence Union Ltd (1995) 184 CLR 399 at 446; [1995] HCA 28.

18. [67]

    While this rule was said to be not invariable, the earlier decision of the High Court in Josephson v Walker (1914) 18 CLR 691 at 698; [1914] HCA 68 (Josephson) is strongly supportive of it. In that case, it was held that a common law action to recover as damages the difference between wages due under an industrial award and those agreed to was not available by reason of the availability under the Industrial Arbitration Act 1912 (NSW) (Industrial Arbitration Act) of a scheme for resolution of disputes in the form of a special tribunal. Similar reasoning was applied by Jordan CJ in Martin to refuse a right of action at common law for a breach of the provisions of s 521 of the Industrial Arbitration Act.

19. [68]

    Examples may be multiplied as to where no action for breach of statutory duty has been held to lie where the statute itself supplies a remedial mechanism beyond the mere existence of a criminal penalty. The simple reasoning is that, where the legislature turned its mind to one or more statutory remedies, its intention impliedly to create a new and additional common law duty was strongly to be doubted. See, for example, Preston at [80]-[93] and especially [87]; Jane Doe at [139]; Gardiner v Victoria [1999] 2 VR 461; [1999] VSCA 100; Grand Central Car Park Pty Ltd v Tivoli Freeholders [1969] VR 62; Polar Aviation Pty Ltd v Civil Aviation Safety Authority (No 4) (2011) 203 FCR 293; [2011] FCA 1126 at [81].

20. [69]

    The imposition of a criminal sanction in the form of a fine or penalty does not, in itself, imply the existence or availability of an action at common law and various decisions have referred to the common law presumption that a remedy specified in a statute is intended to be exclusive: see, for example, Kinzett v McCourt (1999) 46 NSWLR 32; [1999] NSWCA 7 at [54]; see also Preston at [82]; Field at [49].

21. [70]

    It may be inferred that the legislature intended that such a fine or penalty together with the other range of remedies provided by the EI Act would be a strong inducement against a party conducting itself in the proscribed manner, and that the public policy underpinning the EI Act would be thereby given effect.

22. [71]

    In the present case, the level of the penalty for breach of s 11(1) of the EI Act has been left to prescription by the regulations under s 9 of the EI Act and, interestingly, is broadly equivalent to the civil penalties which may be imposed under s 43 of the Act. It was not established that the penalty was inadequate, especially as it would presumably apply to each performance upon which commission was chargeable. In any event, that a penalty may be relatively low in quantum has been said to be incongruent with the availability of common law damages at large: Jane Doe at [112]-[113].

23. [72]

    Applying these principles, it seems to me to be clear that no common law claim for breach of statutory duty was intended to be created by the legislature when passing the EI Act or indeed its predecessor Act.

24. [73]

    Any such intention would need to be divined from the scope and context of the EI Act. Far from providing any support for the existence of such a duty, the provisions of the Act point strongly against it.

25. [74]

    Perhaps the most prominent such provision is s 20, reproduced at [30] above. The existence of potential relief from the Industrial Relations Commission puts the present case on extremely close footing to both Martin and Josephson, and brings the case into the general rule enunciated by Jordan CJ in Martin, as discussed above at [66].

26. [75]

    This conclusion is only reinforced, however, when other remedial features of the EI Act are considered. Thus, as was emphasised by Mr Flynn, ss 21 and 22 provide for the acceptance and enforcement of undertakings for suspected breaches; ss 24 and 25 of the EI Act provide a show cause mechanism which operates where a performer representative has engaged in unlawful conduct (defined in s 4 as a breach of the code of conduct or of a provision of the Act) which may result in entertainment industry prohibition orders being obtained from the Supreme Court. Importantly, s 25(3) provides that:

27. [76]

    This analysis is fortified by the fact, already mentioned, that the statute did not supplement any pre-existing duty of care, as to which see the authorities referred to in [63] above.

28. [77]

    Next, there is also s 43 of the Act providing for civil penalties. Mr Philips, who appeared for the Respondents, correctly pointed out that that section does not include a breach of s 11 of the Act (for which a criminal penalty is prescribed). It does, however, apply to a breach of the code of conduct, cl 2(8) of which imposes an obligation on a performer representative to use best endeavours to ensure that employees comply with the Act and the code of conduct.

29. [78]

    The only other textual argument advanced by Mr Philips in support of the contention that a breach of s 11 generated a common law right of action was s 43(5), to the effect that “[e]vidence given in proceedings for the recovery of money is not admissible in proceedings for a civil penalty”. His submission was that this was a legislative indication that the legislature contemplated an action for breach of s 11. I disagree.

30. [79]

    Section 43(5) is not confined or directed to actions under the EI Act at all. Rather, it gives clear guidance in relation to an evidentiary question which might arise in a civil penalty case. It is in essentially the same form as used in other Acts, a fact that militates against it pointing to the creation of a common law action for breach of s 11(1) of the EI Act: see, for example, Industrial Relations Act 1996 (NSW) s 357(5); Industrial Relations (Child Employment) Act 2006 (NSW) s 15(5). Moreover, it speaks of an action for “the recovery of money”. Such actions go well beyond actions in tort for compensation and could include actions in contract, debt and restitution. The breadth of the section proves rather too much for Mr Philips’ purposes.

31. [80]

    For the above reasons, it is clear, in my view, that no action for breach of statutory duty lies against any of the Applicants. To adopt the submission of the Applicants:

32. [81]

    Thus, contrary to the conclusion of the primary judge, I am satisfied that the Defendants have established that the claims for breach of statutory duty based on the alleged contravention of the EI Act are not tenable and doomed to fail.

33. [82]

    In light of this conclusion and although there was much apparent force to it, it is not necessary to deal with the separate arguments raised in appeal grounds 2(b) or 2(c) by Mr Manton and MMM to the effect that no action could lie against them in any event because they were not a party to any entertainment industry agreement with the Stones, and thus could neither have demanded nor received commission under an entertainment industry agreement. Indeed, neither MMM nor Mr Manton was a party to any agreement with the Stones, had no contractual entitlement vis-à-vis the Stones to be paid commission and are not alleged in any iteration of the original CLS, Draft ACLS or the Filed ACLS to have charged commissions to the Stones under any agreement or at all, although there was evidence before the primary judge that HNOE directed the Stones to transmit some of the commissions they owed HNOE directly to MMM and Mr Manton, presumably to discharge HNOE’s obligations to MMM under the MMM Agreement.

34. [83]

    In [24] of the Draft ACLS and the Filed ACLS, the Stones pleaded that the Management Agreement and the MMM Agreement together comprised one interconnected or related agreement which, at least considered as a whole, amounted to an entertainment industry agreement, within the meaning of the EI Act. This ambitious argument had been floated before the primary judge in the course of argument. His Honour held at PJ [87] that:

35. [84]

    As has been said, although challenged on appeal, this is not an argument which is necessary to be dealt with for present purposes in light of my conclusion as to the unavailability of any claim for breach of statutory duty.

36. [85]

    It is also unnecessary in light of that conclusion to decide appeal ground 2(d), which concerned the extra-territorial application of the EI Act, and arguments to the effect that s 11(1) of the EI Act did not extend to HNOE. The primary judge considered that there was a “debatable question of law as to whether the Act is capable of applying to an entertainment industry agreement with a foreign choice of law clause”: PJ [108]. This argument turned in part on factual questions or mixed questions of fact and law including where demands by HNOE for commission were received. These were not appropriate for determination on a summary basis and, as has been said, were unnecessary to determine given the unavailability of an action for breach of statutory duty.

37. [86]

    One of the reasons the primary judge did not embark upon a consideration of the existence or otherwise of an action for breach of statutory duty was his view, by reference to Wickstead v Browne (1992) 30 NSWLR 1; [1992] NSWCA 272 (Wickstead), that there was marginal utility in doing so because the proceedings would continue in any event because of the separate restitution claim propounded by the Stones: see [49] above.

38. [87]

    With great respect to his Honour, I disagree. Had the case been bound to proceed in New South Wales in any event, there would have been considerable justification, consistent with Wickstead, for his Honour’s reluctance to engage with the question of statutory interpretation presented by the pleaded claims of breach of statutory duty. But, by reason of the exclusive jurisdiction clause in the Management Agreement, there was a live question as to whether the proceedings should continue in New South Wales or be stayed so that they may proceed in the contractually stipulated forum.

39. [88]

    The EI Act claim, both in its original form and then in its recalibrated forms cast as a breach of statutory duty, was evidently being used as something of a jurisdictional “hook” or “anchor” to supply a “strong countervailing reason” why the proceedings should remain in New South Wales notwithstanding the existence of the exclusive jurisdiction clause: see, for example, M Davies et al, Nygh’s Conflict of Laws in Australia (10th ed, 2020) at [8.57]-[8.60]; Global Partners at [89]. So much emerges from PJ [180]-[183] where the primary judge said:

40. [89]

    Insofar as the primary judge made reference to the Defendants not leading any evidence, or making any submission to the effect that the claims of breach of statutory duty and restitution based on alleged contravention of the EI Act in PJ [182]-[183] would be able to be pursued in the High Court of Justice in London, his Honour in my respectful opinion fell into error. This was not a matter for the Defendants to establish; rather, insofar as the authorities require “strong reasons” not to give effect to or enforce an exclusive jurisdiction clause and for a stay to be refused in circumstances where, prima facie, parties should be held to their bargain, this was for the Stones to establish. Thus, if they had established that their claims could not or would not have been entertained or been able to be pursued in England, that may well have established strong reasons not to enforce the exclusive jurisdiction clause. No such evidence was, however led.

41. [90]

    This error was undoubtedly material to the exercise of the primary judge’s discretion to refuse to grant a stay of proceedings as the italicised passage in PJ [183] makes clear.

42. [91]

    Before turning to a re-exercise of the discretion, it is necessary to say something at this point in relation to the Stones’ claims for restitution, raised in ground 2(e) of the draft notice of appeal.

43. [92]

    As against HNOE, whatever other difficulties the restitution claims may face (a matter which was the subject of specific submissions by the Applicants), the claim for restitution against HNOE fell within the scope of the exclusive jurisdiction clause. That clause, it will be recalled, relevantly provided that “the High Court of Justice, Strand, London shall be the sole court of competent jurisdiction”.

44. [93]

    There is a degree of ellipsis in this clause in that it is silent in terms of its subject matter scope, that is to say, it does not take the familiar form of such clauses which use relational or connective phrases such as “all disputes arising out of or connected to this contract shall be determined in the courts of …”. That, however, does not mean that it should be narrowly construed. To the contrary, the established approach in both Australia and England to the construction of such clauses is to accord them a liberal, broad or generous interpretation, giving effect to the “rational assumption of reasonable people by giving liberal width and flexibility where possible to elastic and general words of the contractual submission to [jurisdiction], unless the words in their context should be read more narrowly”: Hancock Prospecting Pty Ltd v Rinehart (2017) 257 FCR 442; [2017] FCAFC 170 at [167]. As Spigelman CJ observed in Global Partners at [67], in identifying the rationale for the broad construction of arbitration and exclusive jurisdiction clauses:

45. [94]

    The generally broad approach taken to the construction of the scope of jurisdiction clauses was considered at some length in Inghams Enterprises Pty Limited v Hannigan [2020] NSWCA 82; (2020) 379 ALR 196 at [53]-[67]. In Nyunt v First Property Holdings Pte Ltd [2022] NSWCA 249; (2022) 408 ALR 277, I noted that the jurisdiction clause in the Joint Venture Agreement in that case contained an ellipsis in the sense that, by that clause, both parties submitted to the jurisdiction of the Courts of Singapore but the clause was silent in respect of the scope or extent of that submission: at [95]. At [98], I held that “[w]here, as in the present case, the parties did not seek to delimit the scope of their submission to jurisdiction by specifying any nexus at all, it may readily be inferred that their intention was to cast the net very broadly indeed”. See also Qantas Airways Ltd v Rohrlach [2021] NSWCA 48; (2021) 304 IR 218 at [60]-[67].

46. [95]

    The elliptical jurisdiction clause in the present case bears some similarity to two jurisdiction clauses which were considered by Giles CJ Comm Div in FAI General Insurance Co Ltd v Ocean Marine Mutual Protection & Indemnity Association (1997) 41 NSWLR 559 at 568:

47. [96]

    Thus, his Honour held that non-contractual claims to rescind the policies and to set them aside for non-disclosure nonetheless fell within the scope of the jurisdiction clause. (An earlier decision had held that the clauses conferred exclusive jurisdiction on the English courts: FAI General Insurance Co Ltd v Ocean Marine Mutual Protection and Indemnity Association (1997) 41 NSWLR 117.)

48. [97]

    The claims by the Stones for restitution against HNOE fell within the scope of the exclusive jurisdiction clause. There must be attributed to the parties a contractual intention to submit any disputes arising out of the relationship established by the Management Agreement to litigation in London. No commercial purpose would be served by stipulating that the High Court of Justice was to be “the sole court of competent jurisdiction” had the parties not intended that all disputes arising out of or relating to the Management Agreement would be subject to that clause. Any claim for restitution as a result of mistakenly overpaid commission under the Management Agreement plainly fell within that clause and no persuasive argument was advanced against such a conclusion.

49. [98]

    It follows that the entirety of the claims against HNOE, namely, claims under and for breach of the Management Agreement and for restitution in relation to allegedly mistaken payments fell within the scope of the exclusive jurisdiction agreement and prima facie should be stayed.

50. [99]

    What, then, of the restitution claims made against MMM and Mr Manton? It was far from evident in the original CLS whether, to the extent that restitution was sought from the Defendants, a free standing cause of action in restitution was being pursued as opposed to the Stones simply using the word “restitution” in the sense of seeking repayment of what were said to have been overpayments of commission by reason of the Stones’ ignorance of s 11(1) of the EI Act (on the assumption that it applied to the parties). The primary judge regarded the pleading of the restitution claim to be unsatisfactory. His Honour noted at PJ [159] that the Stones sought an order that the Defendants “provide restitution to the Plaintiffs with respect to [their] breaches of the ... EI Act”. At PJ [163], his Honour accepted that “neither the existing CLS nor the Draft ACLS identifies the vitiating factor upon which the Plaintiffs rely to establish an entitlement to restitution.”

51. [100]

    At PJ [165]-[166], the primary judge observed:

52. [101]

    In the Filed ACLS, the restitution claim against MMM and Mr Manton was repleaded as follows:

53. [102]

    This form of the pleading was not before the primary judge and thus its existence did not inform the exercise of his Honour’s discretion although it may fairly be said that his Honour contemplated that such a claim may be available: see PJ [166] reproduced at [100] above. For reasons explained at [19]-[20] above, the Filed ACLS was before this Court on the hearing of the appeal and it is relevant to take it into account in the re-exercise of the discretion in light of my conclusions as to the unavailability of the claims for breach of statutory duty.

54. [103]

    The Defendants attacked the fresh claim for restitution in the Filed ACLS on the following bases:

55. [104]

    It is neither necessary nor desirable, in my view, to consider the strength of this objection to the claim in restitution. Unlike consideration of the claim for breach of statutory duty, the availability of any restitutionary claim as against MMM and Mr Manton is not divorced from factual inquiry, making it inapposite for summary dismissal. That is not the end of the matter, however. I deal with its continuing significance at [109]-[113] below.

Re-exercise of discretion

1. [105]

   Error having been established bearing upon the exercise of the primary judge’s discretion, that discretion falls to be re-exercised.

2. [106]

   The relevant principles bearing upon the exercise of the discretion in a case such as the present have been set out in cases such as Global Partners and Hive. These and many other cases emphasise the important role that exclusive jurisdiction clauses play in commercial agreements. In Hive at [76], I observed that:

3. [107]

   I indicated in Hive at [78] that the case law discloses not so much a “test” for or governing the exercise of discretion in this area but rather an approach which begins with a “firm disposition in favour of maintaining [the] bargain unless strong reasons be adduced against a stay” which has been described as a “prima facie position”: Akai at 445.

4. [108]

   The position is more complicated where claims by or against non-parties to the exclusive jurisdiction agreement are also included in the proceedings. Hive was just such a case as was Global Partners. The presence of such claims may, but not necessarily will, provide strong reasons against the grant of a stay of proceedings by reference to an exclusive jurisdiction clause between some but not all of the parties to the litigation. In Hive at [90], I indicated that:

5. [109]

   This leads to the question whether the existence of the restitutionary claim against MMM and Mr Manton as set out at [101] above itself supplies a strong reason for refusing a stay of proceedings and thus deprives HNOE of the benefit of its bargained for exclusive jurisdiction clause. In my view it does not, and to allow it to have that effect would be a case of the tail being allowed to wag the jurisdictional dog. The present case, in this regard, is closely analogous to Global Partners. In that case, the plaintiff had sued Babcock & Brown Ltd (in liq) (Babcock) and a number of related companies. Global Partners and Babcock were parties to an English exclusive jurisdiction and choice of law agreement. The related Babcock parties were not party to that agreement but this did not prevent this Court from upholding a decision to stay the entirety of the proceedings. Under the heading “Party scope”, Spigelman CJ made the following observations:

6. [110]

   At [78], Spigelman CJ went on to hold that “[n]otwithstanding the fact that BBL, BBI and BBUS are not parties to the LPA, they cannot be categorised as members of an undifferentiated group of ‘non parties’. It may well be that cl 18.11 will not apply to other non parties. However, the respondents in the present case are in a quite distinct category”.

7. [111]

   The inclusion of the related companies as the Fourth to Sixth Plaintiffs in the Filed ACLS and the restitution claims sought to be agitated against MMM and Mr Manton in it make the present case closely analogous to Global Partners. MMM and Mr Manton provided their services to the Stones not directly, but through HNOE and under the Management Agreement which contained the exclusive jurisdiction clause. Equally, the involvement of the related companies was as parties which the Stones used to make commission payments to HNOE under the Management Agreement. Neither the related companies nor MMM and Mr Manton can be categorised as “members of an undifferentiated group of non-parties”, to quote Spigelman CJ in Global Partners.

8. [112]

   In drawing this analogy, it is not necessary to go so far as to say that the related companies and MMM and Mr Manton are “bound” by the exclusive jurisdiction clause. An alternative way of putting the matter is to say that, as between the Stones and HNOE, the disputes are governed by the exclusive jurisdiction clause and prima facie must be heard in accordance with the parties’ contractual agreement. That being so, and bearing in mind the very close and interconnected relationship between those disputes and the claims in restitution brought against MMM and Mr Manton, New South Wales would be a clearly inappropriate forum in which to determine such closely related claims: see Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 at 559-560, 564-5; [1990] HCA 55; Henry v Henry (1996) 185 CLR 571 at 591; [1996] HCA 51; CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345 at 399-401; [1997] HCA 33; see also Oceanic at 247-8. A stay of the residual claims against MMM and Mr Manton would be justified by reference to the “controversy as a whole”: see also Hive at [88]-[89].

9. [113]

   The Plaintiffs’ claims against MMM and Mr Manton would be able to be made in England as part of the dispute between the Stones and HNOE, and MMM and Mr Manton must, by reason of their being parties to the application for a stay of proceedings, be taken to have evinced a willingness for the disputes (including those against them – other than the non-tenable claims for breach of statutory duty) to be heard in England. Were those parties not to submit to the jurisdiction of the English courts in any proceedings brought against them, it would be open to the Respondents to seek to lift any stay granted against them.

10. [114]

    To the extent that [29] of the Filed ACLS (see [40] above) seeks restitution for payments made under the Manton Julia Agreement, as pointed out at [41] above, no commissions are alleged to have been charged or demanded by Mr Manton or received by him under that Agreement. In the course of argument in this Court, counsel for the Respondents was unable to explain where or how the Manton Julia Agreement had any relevance. Accordingly, I do not take them into account.

11. [115]

    In re-exercising the Court’s discretion, I have regard to the following matters:

    1. (1)

       the claims for breach of statutory duty are untenable;

    2. (2)

       the claims for restitution against HNOE fall within the scope of the exclusive jurisdiction clause;

    3. (3)

       the claims for breach of the Management Agreement against HNOE fall within the scope of the exclusive jurisdiction clause;

    4. (4)

       the claims for restitution against MMM and Mr Manton are closely related to the claims for restitution against HNOE, especially given the Respondents’ contention as to the interrelationship between the Management Agreement and the MMM Agreement;

    5. (5)

       the existence of those claims in all of the circumstances of the case do not supply strong reasons against the grant of a stay of proceedings;

    6. (6)

       the Respondents can bring their claims against all Defendants in one forum, that being the one the Stones contractually bargained for with HNOE in the Management Agreement which was stated to appoint HNOE their exclusive agent;

    7. (7)

       reference in the Filed ACLS to the Manton Julia Agreement does not appear to disclose any cause of action given that no commissions are alleged to have been charged or demanded by Mr Manton or received by him under that Agreement; and

    8. (8)

       the claims by the related companies appear to pertain to payments of commission they made on behalf of the Stones. If free-standing claims at all, they are intimately bound up with the claims made by the Stones which are governed by the Management Agreement and which should be heard in England.

12. [116]

    Bearing these matters in mind, the proceedings should be stayed.

Conclusion and orders

1. [117]

   I propose the following orders:

   1. (1)

      Grant leave to appeal.

   2. (2)

      Appeal allowed with costs.

   3. (3)

      Set aside the orders of the primary judge and in lieu thereof, order that:

2. [118]

   LEEMING JA: I agree with Bell CJ for the reasons that his Honour gives that this Court should intervene, allow the appeal and stay the proceedings. As the Chief Justice explains, that is principally because the claim for damages for breach of statutory duty is bad in law, while the restitutionary claims for recovery against HNOE fall within the scope of the exclusive jurisdiction clause. Without detracting from the comprehensive reasons of the Chief Justice, I would add the following.

3. [119]

   The passage in Barwick CJ’s reasons, sitting in the original jurisdiction of the High Court, in General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 130; [1964] HCA 69 is familiar but also, with respect, somewhat opaque as to its application in any particular case:

4. [120]

   More recently, the joint judgment in Agar v Hyde (2000) 201 CLR 552; [2000] HCA 41 at [57] observed that “[t]he test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way.” The joint judgment in Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256; [2006] HCA 27 at [46] cautioned that the statements in General Steel should not be given “canonical force”. In Shaw v State of New South Wales [2012] NSWCA 102 at [32], Barrett JA (with whom Beazley, McColl and Macfarlan JJA and McClellan CJ at CL agreed) enunciated the test thus:

5. [121]

   Ultimately it is a question of judgment, but where as in the present case the viability of a claim for damages for breach of statutory duty was a pure question of law, it was open and appropriate to resolve it in the course of determining the motion to enforce the exclusive jurisdiction clause. Further, because there were no facts and the arguments relatively brief, there was no occasion for a separate question to be ordered before that could occur.

6. [122]

   Finally, I would also adhere to the Chief Justice’s observations about the expeditious way in which the primary judge resolved a complicated motion, which altered its form as the hearing progressed.

7. [123]

   I agree with the orders proposed by the Chief Justice.

8. [124]

   PAYNE JA: I agree with the orders proposed by the Chief Justice and with his Honour’s reasons. I also agree with the additional observations of Leeming JA.