The Supreme Court of Victoria heard an application by a defendant for joinder of an alleged ‘concurrent wrongdoer’ in respect of claims made under the Corporations Act 2001 (Cth). After full and considered argument, the Court held that the claim for relief under the Corporations Act was not apportionable.

Yeo & ors v Freeman & ors [2018] VSC 448

For a State law to apply to the Court’s exercise of Federal jurisdiction, in this instance, the Wrongs Act 1958 (Vic), it has to be ‘picked up’ by section 79 of the Judiciary Act 1903 (Cth). Section 79 will only ‘pick up’ the Wrongs Act if the relevant Federal law, the Corporations Act, does not ‘otherwise provide.’

Section 79(1) of the Judiciary Act provides that:

The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable. [Emphasis added.]

The question for the Court was whether the Corporations Act 2001 (Cth) had, by the scheme constituted by sections 1317H (Compensation Orders), 1317S (Relief from liability for contravention of civil penalty provision) and 1318 (Power to grant relief), ‘otherwise provided’ for the determination of liability to compensate persons who have suffered damage by reason of the breach of section 180, so as to prevent the application of the proportionate liability provisions of Pt IVAA of the Wrongs Act: [28]

The Court followed Dartberg Pty Ltd v Wealthcare Financial Planning Pty Ltd,[1] in which Middleton J considered the application of Pt IVAA of the Wrongs Act in the context of a claim involving different provisions of the Corporations Act.

The Court held the provisions of Pt IVAA are not picked up by section 79 of the Judiciary Act because the provisions of the Corporations Act pursuant to which the plaintiffs claimed relief, ‘otherwise provide’: [47]. The Court was of the view that:

  • the Commonwealth enacted a scheme which entitled the plaintiffs to recover damages under section 1317H, subject to relief from all or part of that liability under sections 1317S and 1318.
  • the Wrongs Act provisions are not complementary but rather inconsistent with this scheme.