Celtic Resources Holdings Plc v Arduina Holding BV
[2006] WASC 68
CELTIC RESOURCES HOLDINGS PLC -v- ARDUINA HOLDING BV & ANOR [2006] WASC 68
| (2006) 32 WAR 276 | |||
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2006] WASC 68 | |
| Case No: | FRJ:2/2006 | 20 & 21 MARCH 2006 | |
| Coram: | HASLUCK J | 21/03/06 | |
| 16 | Judgment Part: | 1 of 1 | |
| Result: | Application to register foreign judgment and Mareva injunction dismissed | ||
| A | |||
| PDF Version |
| Parties: | CELTIC RESOURCES HOLDINGS PLC ARDUINA HOLDING BV AUSTOCK NOMINEES PTY LTD (ACN 054 990 359) |
Catchwords: | Private international law Foreign judgments Effect and enforcement Foreign Judgments Act 1991 (Cth) Arbitration award in United Kingdom entered as judgment in that place Ex parte application for registration of judgment in Western Australia pursuant to Foreign Judgments Act 1991 (Cth) and application for Mareva injunction Section 6(6) Foreign Judgments Act explicit that a judgment is not to be registered if at the date of the application it could not be enforced in the country of the original Court Original judgment not yet enforceable due to lack of service upon defendant Application to register the judgment in Western Australia refused Nature of inherent jurisdiction to grant Mareva relief in aid of foreign proceedings in relation to assets in Australia Need to establish actual or potential abuse of process Application for Mareva injunction refused |
Legislation: | Arbitration Act 1996 (UK), s 66 Civil Procedure Rules (UK), s 66, Pt 62 Foreign Judgments Regulations 1992 (Cth), reg 3, reg 4 Foreign Judgments Act 1991 (Cth), s 3, s 5, s 6 Judgments Act 1838 (UK), s 17 Rules of the Supreme Court 1971 (WA), O 10, O44A r 3, O44A r 8 Service and Execution of Process Act 1992 (Cth) Supreme Court Act (1935) (WA), s 25(9) Supreme Court Act 1981 (UK), s 1(1), s 19(1) |
Case References: | Aspermont Ltd v Lechmere Financial Corp (2002) 27 WAR 1 Australian Broadcasting Corp v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345 Davis v Turning Properties Pty Ltd [2005] NSWSC 742 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 Official Receiver of State of Israel v Raveh (2001) 24 WAR 53 Perth Mint v Mickelberg (No 2) [1985] WAR 117 Raveh v The Official Receiver of the State of Israel in his capacity as liquidator of the North America Bank Ltd in Liquidation [2002] WASCA 27 Siskina, Owners of the Cargo on board the v Distos Compania Naviera SA [1979] AC 210 Beach Petroleum NL v Johnson (1992) ACSR 404 Brereton v Milstein [1988] VR 508 Chew v Satay House of WA Pty Ltd & Ors, unreported; SCt of WA; Library No 970570; 14 October 1997 Jet West Ltd v Haddican [1992] 2 All ER 545 Riley McKay Pty Ltd v McKay [1982] 1 NSWLR 264 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
and
Judgment of the High Court of Justice obtained in Celtic Resources Holdings PLC v Arduina Holding BV (Claim Number 2006 Folio 165) and dated 8 March 2006
- Applicant
AND
ARDUINA HOLDING BV
First Respondent
AUSTOCK NOMINEES PTY LTD (ACN 054 990 359)
Second Respondent
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Catchwords:
Private international law - Foreign judgments - Effect and enforcement - Foreign Judgments Act 1991 (Cth) - Arbitration award in United Kingdom entered as judgment in that place - Ex parte application for registration of judgment in Western Australia pursuant to Foreign Judgments Act 1991 (Cth) and application for Mareva injunction - Section 6(6) Foreign Judgments Act explicit that a judgment is not to be registered if at the date of the application it could not be enforced in the country of the original Court - Original judgment not yet enforceable due to lack of service upon defendant - Application to register the judgment in Western Australia refused - Nature of inherent jurisdiction to grant Mareva relief in aid of foreign proceedings in relation to assets in Australia - Need to establish actual or potential abuse of process - Application for Mareva injunction refused
Legislation:
Arbitration Act 1996 (UK), s 66
Civil Procedure Rules (UK), s 66, Pt 62
Foreign Judgments Regulations 1992 (Cth), reg 3, reg 4
Foreign Judgments Act 1991 (Cth), s 3, s 5, s 6
Judgments Act 1838 (UK), s 17
Rules of the Supreme Court 1971 (WA), O 10, O44A r 3, O44A r 8
Service and Execution of Process Act 1992 (Cth)
Supreme Court Act (1935) (WA), s 25(9)
Supreme Court Act 1981 (UK), s 1(1), s 19(1)
Result:
Application to register foreign judgment and Mareva injunction dismissed
Category: A
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Representation:
Counsel:
Applicant : Mr B H Taylor, Ms M M N Byrne & Mr C P Dunnell
First Respondent : No appearance
Second Respondent : No appearance
Solicitors:
Applicant : Talbot & Olivier
First Respondent : No appearance
Second Respondent : No appearance
Case(s) referred to in judgment(s):
Aspermont Ltd v Lechmere Financial Corp (2002) 27 WAR 1
Australian Broadcasting Corp v Lenah Game Meats Pty Ltd (2001) 208 CLR 199
Cardile v LED Builders Pty Ltd (1999) 198 CLR 380
CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345
Davis v Turning Properties Pty Ltd [2005] NSWSC 742
Jackson v Sterling Industries Ltd (1987) 162 CLR 612
Official Receiver of State of Israel v Raveh (2001) 24 WAR 53
Perth Mint v Mickelberg (No 2) [1985] WAR 117
Raveh v The Official Receiver of the State of Israel in his capacity as liquidator of the North America Bank Ltd in Liquidation [2002] WASCA 27
Siskina, Owners of the Cargo on board the v Distos Compania Naviera SA [1979] AC 210
Case(s) also cited:
Beach Petroleum NL v Johnson (1992) ACSR 404
Brereton v Milstein [1988] VR 508
Chew v Satay House of WA Pty Ltd & Ors, unreported; SCt of WA; Library No 970570; 14 October 1997
Jet West Ltd v Haddican [1992] 2 All ER 545
Riley McKay Pty Ltd v McKay [1982] 1 NSWLR 264
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1 HASLUCK J: The applicant, Celtic Resources Holdings PLC ("Celtic"), has brought two matters before the Court, being first an ex parte application for registration of a judgment pursuant to provisions of the Foreign Judgments Act 1991 (Cth) and second, an application for a Mareva injunction.
2 The former application is supported by the affidavit of Melanie Mei Na Byrne sworn 17 March 2006. I will call this the first Byrne affidavit. The Mareva application is supported by an affidavit sworn on the same date by the same deponent. I will call this the second Byrne affidavit. The applicant has presented an undertaking as to damages in the usual form. The Mareva application is directed also to the second-named respondent Austock Nominees Pty Ltd.
The application for registration of judgment
3 It will be convenient to begin by looking at the application for registration of judgment. It appears from the first Byrne affidavit that Celtic is a public company incorporated in the Republic of Ireland which is listed on the AIM market of the London Stock Exchange. The respondent Arduina Holding BV is a company incorporated in the Netherlands.
4 On 22 November 2002 Celtic and Arduina entered into the so-called Framework Agreement which was intended to provide a condition precedent to the operation of certain specified loan assignments entered into on that date. It also provided for Celtic to have obligations in certain circumstances to encourage a transfer of shares to Arduina from a third party. It allowed for disputes to be settled by arbitration.
5 It seems that Arduina made claims against Celtic, seeking damages for pre-contractual misrepresentations and for breach of the Framework Agreement by reason of Celtic not discharging its obligations to encourage a transfer of certain shares to Arduina. Celtic denied these claims and sought declaratory relief that the Framework Agreement was terminated due to non-fulfilment of a condition precedent by a prescribed date. This dispute became the subject of an arbitration hearing in London from 11 to 22 July 2005.
6 In due course on 12 December 2005 the arbitrator made an award rejecting all of Arduina's claims and made the declarations sought by Celtic with respect to the status of the Framework Agreement. On 22 February 2006 the arbitrator made a final award, providing for Arduina
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- to pay Celtic the sum of £916,338.28 in respect of arbitration and legal costs.
7 Section 66 of the Arbitration Act 1996 in the UK provides that an award made by the Tribunal pursuant to an arbitration agreement may, by leave of the Court, be enforced in the same manner as a judgment or order of the Court to the same effect. Where leave is so given, judgment may be entered in terms of the award.
8 It was pursuant to this provision that on 8 March 2006 a judgment was entered in the High Court of Justice, Queen's Bench Division in the United Kingdom. The judgment refers to Celtic having been granted permission pursuant to s 66(1) of the Arbitration Act by Coleman J to enforce the subject award dated 22 February 2006 in the same manner as a judgment or order. Further, it was adjudged that Arduina pay to Celtic the sum of £916,338.28.
9 However, I pause here to note that by Pt 62 of the Civil Procedure Rules in the United Kingdom concerning arbitration claims the enforcement of awards is qualified to some extent. Clause 62.18(1) provides that an application for permission under s 66 of the 1996 Act to enforce an award in the same manner as a judgment or order may be made without notice in an arbitration claim form. It was pursuant to this provision, it seems, that the order for permission was made.
10 Clause 62.18(9) provides that within 14 days after service of the order, or if the order is to be served out of the jurisdiction within such other period as the Court may set, the defendant may apply to set aside the order and the award must not be enforced until after the end of that period or any application made by the defendant within that period has been finally disposed of.
11 Counsel for Celtic acknowledged in the course of the hearing before me that the 8 March order underlying the subject judgment has not been served upon Arduina. It follows that as of the date of the hearing before me in the United Kingdom Celtic was not in a position to enforce the subject award in the same manner as a judgment or order. This brings me to the Foreign Judgments Act 1991(Cth).
12 By s 3 of the Act "judgment" means "A final or interlocutory judgment made by a court in civil proceedings." By s 5, the Act is said to apply to an enforceable money judgment that is final and conclusive and was given in a superior court of a country in relation to which the Act extends.
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13 By reg 3 of the Foreign Judgments Regulations 1992 (Cth), the United Kingdom is specified as a country to which the Act extends. Section 6(1) of the Foreign Judgments Act 1991 reads as follows:
"(1) A judgment creditor under a judgment to which this Part applies may apply to the appropriate court at any time within 6 years after:
(a) the date of the judgment; or
(b) where there have been proceedings by way of appeal against the judgment, the date of the last judgment in those proceedings;
to have the judgment registered in the court."
"(3) Subject to this Act and to proof of the matters prescribed by the applicable Rules of Court, if an application is made under this section, the Supreme Court of a State or Territory or the Federal Court of Australia is to order the judgment to be registered.
…
(6) A judgment is not to be registered if at the date of the application:
(a) it has been wholly satisfied; or
(b) it could not be enforced in the country of the original court."
16 Order 44A rule 8 provides that notice in writing of the registration should be served on the judgment debtor in accordance with O 10 and the Service and Execution of Process Act 1992 (Cth) if the debtor is out of the jurisdiction. Order 10 rule 7 provides that the Court may allow a service
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- outside the jurisdiction of notice in any proceedings. It is on this basis that I have before me additional papers whereby Celtic seeks leave to serve notice of registration of judgment out of the jurisdiction pursuant to O 10 r 7 on the respondent at an address in Amsterdam, the Netherlands. Arduina is to have 14 days from the date of service of the notice of registration within which to apply to set aside the registration of the judgment.
17 These papers reflect the position established by s 7 of the Foreign Judgments Act 1991 (Cth) whereby a party against whom a registered judgment is enforceable may seek to have the registration of the judgment set aside by duly applying to the Court in which the judgment was registered. The same provision sets out the grounds upon which registration of the judgment may be set aside.
The issues
18 It will be apparent from my review of the relevant provisions that there is a contentious issue to be resolved in the circumstances of the present case before the 8 March judgment can be registered. Section 6(3) of the Foreign Judgments Act suggests the obligation to register a judgment is mandatory. However, s 6(6) is explicit that a judgment is not to be registered if at the date of the application it "could not be enforced in the country of the original court." At this stage, bearing in mind that the 8 March judgment has not been served upon Arduina, the judgment is not enforceable, for cl 62.18(9) of the Civil Procedure Rules in the United Kingdom provides that the judgment must not be enforced until after 14 days or further period of the service of the order.
19 In these circumstances I feel compelled to hold that the judgment cannot be registered in the Supreme Court of Western Australia as proposed because it is a judgment that at the date of the application could not be enforced in the country of the original Court. In other words, the 8 March judgment undoubtedly has the potential to be enforced in the country of the original Court once service upon Arduina has been effected and the prescribed period has elapsed, presuming the judgment is not set aside. However, for the time being, it would be contrary to the law of the United Kingdom for the judgment to be enforced in the country of the original Court. Accordingly, for these reasons, I consider that I am obliged to dismiss the application made by Celtic for registration of the subject judgment in the Supreme Court of Western Australia.
20 However, that is not necessarily the end of the matter. It is against this background, and having regard to the possibility that the 8 March
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- judgment could not be registered, that Celtic applies for the Court by way of Mareva injunction.
The application for Mareva injunction
21 Celtic contends that it has a strong prospect of being able to register and enforce the subject judgment in due course and, in circumstances in which on Celtic's case there is a risk that assets belonging to Arduina will be dissipated before the judgment can be enforced, Celtic should be able to obtain relief by way of Mareva injunction. Accordingly, I must now turn to the second application and the evidentiary materials relevant to this aspect of the matter.
22 The Mareva order is sought in aid of enforcement of the subject judgment. An order is also sought for leave to serve any Mareva order out of the jurisdiction. It appears from the second Byrne affidavit that inquiries had been made in the Netherlands on behalf of Celtic to ascertain the asset holdings and financial position of Arduina. These inquiries indicate that the company has no employees; its business is described as a financing and holding company. Its sole director is a Mr Sittard who is resident at Pinner, Middlesex in the United Kingdom; its sole shareholder is International Mineral Resources AG, being a Swiss entity.
23 According to the second Byrne affidavit, Arduina's sole fixed asset is stated to be an investment in Emperor Mines Ltd, the value of which is said to be, as at 31 December 2004, £8,672,093. At that time, Arduina's long term liabilities was stated to be £10,652,931.
24 Emperor Mines is a listed public company with a registered office in Queensland. Arduina is listed as a substantial shareholder of Emperor Mines to the extent of 14.99 per cent of the company. It is said that as at 3 August 2004, Arduina held 23,753,406 shares in Emperor Mines.
25 I pause here to note that in the course of argument, reference was made to a newspaper article in The Age dated 17 July 2004 in which a cursory account is provided of Emperor Mines. The description is to this effect. In its earlier years, Emperor was run by a progression of various colonials, entrepreneurs and various other folk who fancied owning a gold mine at Vatukoula in Fiji.
26 The article goes on to say that in more recent times the company, which has been producing gold since the 1930s, has been under the effective control of Durban Roodepoort, a South African company that
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- until recently held slightly less than 20 per cent of the capital. It is said that Durban Roodepoort launched a paper takeover bid in March of 2004 and the offer was sweetened in June. It looked as if Emperor's names would disappear from the stock exchange lists.
27 The columnist in The Age says further (as at mid 2004) that that might still be the case, but a spoke in the wheel appeared when the Amsterdam based Arduina Holding BV surfaced as a substantial shareholder. The article then goes on to refer to other share movements bearing upon the company in question. This brings me to some further details concerning Emperor Mines and the role of the two respondents to the Mareva application before me, that is, Arduina as first respondent and Austock as second respondent.
28 In the second Byrne affidavit, the deponent sets the scene by describing shareholdings in Emperor Mines and the general position of that company. Then at par 28 the deponent goes on to say that by reason of the matters she has earlier referred to, she verily believes that as at 3 August 2004 Arduina held 23,753,406 shares in Emperor Mines. Reference is made to documents which indicate that the shares held by Austock increased from zero to 23,753,406 on or about 16 November 2004 and to other indications that Austock does not hold the shares beneficially.
29 It is said by the deponent, from information obtained from the ASX web site, that she believes that on or about 5 December 2005, Emperor Mines issued a further 23,200,000 ordinary fully paid shares in capital raising. From her consideration of the relevant papers, the deponent believes that the share holding of DRD (Isle Of Man) Ltd increased to 71,511,904 shares and by reason of the new share issue, DRD (Isle of Man) Ltd's overall interest in Emperor Mines reduced from 45.33 per cent to 39.2 per cent based on the volume of shares on issue.
30 The deponent goes on to say that based on the information she has, the number of shares on issue and the known share holding of Austock, she believes that Austock has 13.1 per cent interest in Emperor Mines. She does not believe that Arduina or Austock has at any stage lodged notice with ASIC to the effect that the number of shares held or the beneficial interest in the shares has changed. She concludes, importantly for present purposes, at par 36, that by reason of the matters she has referred to, she believes that Austock holds 23,753,406 of the issued shares in Emperor Mines for Arduina.
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31 The affidavit goes on to make reference to other matters concerning the dealing in shares and the situation of Emperor Mines and the respondent companies. It emerges from the passages in the affidavit I have referred to, that the Celtic case before me essentially is that there is a link between Arduina and Austock of the kind I have just referred to and it is for that reason that Mareva relief is sought in a form applicable to both respondents.
32 The grounds for the deponent's belief that there is a real risk if a Mareva order is not made that Arduina will act to divest itself of its share holding in Emperor Mines to avoid enforcement of the judgment and to frustrate the Court's processes, are described in this way: Arduina has an overseas place of incorporation; it has only been incorporated since 10 January 2002; it has no ties within Australia; its only significant asset is the shares in Emperor Mines; those shares are liquid in the sense that they are easily capable of being transferred to a related party; Arduina conducts no business to which the holding of the shares is ancillary.
33 Reference is also made, in the second Byrne affidavit, to certain events surrounding the conduct of the arbitration and the possibility that Arduina would mount an appeal which is said to support the present application. These events are said to reveal an unco-operative and evasive attitude to the arbitration and the outcome of it. The unco-operative attitude as to payment of costs is said to be evidenced in particular by a letter dated 22 February 2006 to the arbitrator, written by Mr Michael Wilson of Michael Wilson and Partners, being a law firm acting for Arduina.
34 It is said further by the deponent that upon registration of the judgment, Celtic seeks leave to serve any Mareva order granted by the Court in aid of enforcement of the judgment. The deponent verily believes that the event of registration of the judgment in Western Australia is an implied contract between the applicant and the first respondent for recovery of the moneys under the judgment and the applicant has a good cause of action under the judgment.
35 It is said further that based on the matters described in the second Byrne affidavit and the lack of information about Arduina's financial position and its connection with others, if there was a sale of Arduina's interest in Emperor Mines it is likely that it would be very difficult for Celtic to trace the moneys received as the sale proceeds, assuming there were any, to the ultimate recipients of the funds.
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36 For these reasons Celtic is concerned that there is a real risk that the shares in Emperor Mines will be dissipated to avoid payment under the judgment. It is against this background that orders are sought pursuant to the operative chamber summons dated 17 March 2006 to the effect that Arduina be restrained from disposing of or otherwise dealing with shares held in Emperor Mines Ltd, such injunction to operate in respect of Emperor shares with a total unencumbered value of no less than $AUD3 million based on one Emperor share having a value of 43 cents, without the prior consent of Celtic.
37 The injunction, if granted, is not to prevent Arduina from paying reasonable legal fees in defence of the action up to $5000 and thereafter not exceeding $1000 per week. A series of related orders are also sought and relief of a similar kind directed to Austock as the second-named respondent.
38 It will be useful now to look at some legal principles bearing upon the grant of a Mareva injunction.
39 Section 25(9) of the Supreme Court Act (1935) (WA), contains a general power for the Court to make various orders if and when and in terms that the Court thinks to be, "just or convenient". It appears from the reasoning in Jackson v Sterling Industries Ltd (1987) 162 CLR 612, that the rationale for the grant of a Mareva injunction was to prevent the abuse of the process of the Court by the frustration of its remedies.
40 This suggested that the power of a court to grant orders of the Mareva type was as much to be found in its inherent power to prevent the abuse of its process as in any statutory power to grant such relief as is just or convenient. This approach suggests that the Mareva injunction represents a limited exception to the general rule that a plaintiff must obtain his judgment and then enforce it. He cannot prevent the defendant from disposing of his assets merely because he fears that there will be nothing against which to enforce his judgment and nor can he be given a secured position against other creditors.
41 It follows from reasoning of this kind that a Mareva order is essentially an ancillary remedy to prevent a party frustrating the substantial judicial process of the Court in relation to the pursuit of a cause of action before the Court. The power to grant a Mareva order must be exercised sparingly. These principles have been applied in cases such as Perth Mint v Mickelberg (No 2) [1985] WAR 117, in which it was held that in order to obtain a Mareva injunction the plaintiff must show a
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- good arguable case and a real risk that if the injunction is not granted the defendant will remove or dissipate his assets.
42 The purpose of the order is to ensure, so far as is possible, that the pool of assets against which a court order might be enforced in due course is not diminished in a manner which would be an abuse of its process. Recently decided cases strongly suggest that a Mareva order can be made against a person who is not necessarily a party to the proceedings presently before the Court and in circumstances where a claim for a nominated amount has not yet been commenced: Aspermont Ltd v Lechmere Financial Corp (2002) 27 WAR 1 at par 44.
43 I pause here to note that it is on this basis that it is said Mareva relief can be obtained against the second named respondent, Austock, even though no action has been commenced against or judgment obtained in respect of that party. In that regard counsel for Celtic relies upon the decision of the High Court in Cardile v LED Builders Pty Ltd (1999) 198 CLR 380.
44 In Official Receiver of State of Israel v Raveh (2001) 24 WAR 53, the plaintiff proposed to have a judgment obtained in the District Court of Israel registered as a foreign judgment in Western Australia. The plaintiff's application for an injunction was refused on the grounds that it was not related to an underlying right or cause of action pursued in the Supreme Court of Western Australia. Murray J was of the view that a Mareva order could only be granted to operate upon a defendant who seeks to evade or acts in a way calculated to defeat the enforcement in the Supreme Court of Western Australia of a substantive right pursued by the plaintiff in that Court.
45 I digress briefly to note that the decision of Murray J was reviewed by the Full Court in Raveh v The Official Receiver of the State of Israel in his capacity as liquidator of the North America Bank Ltd in Liquidation [2002] WASCA 27. However, that review did not impinge upon the views that Murray J expressed concerning the principles applicable to the grant of a Mareva injunction.
46 In Davis v Turning Properties Pty Ltd [2005] NSWSC 742, Campbell J was prepared to make a Mareva order to assist the enforcement of certain court orders obtained in the Bahamas, even though those orders had not yet been registered in New South Wales.
47 Indeed, as counsel for Celtic emphasised in the course of argument before me, it was a case in which the judgment could not be registered
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- because the Bahamas was not a country to which the facilities of the Foreign Judgments Act have been extended.
48 The reasoning of Campbell J suggested that the proceedings for a Mareva order are not proceedings for an injunction; the Court must inquire as to whether there is prima facie evidence of those facts which are the basis for the grant of the particular interlocutory relief in question; and a reasonably arguable basis for any question of law involved as to the facts.
49 His Honour indicated also that the administration of justice New South Wales is not confined to the orderly disposition of litigation which was begun and tried in that state. The administration of justice in New South Wales includes the enforcement in that state of rights established elsewhere.
50 Importantly for present purposes, his Honour held that there is an inherent jurisdiction to make an order in aid of the enforcement of a foreign judgment in Australia whether that judgment has yet been obtained or not. Counsel for Celtic in the present case relies upon that conclusion. These cases suggest that Australia's superior Courts have at least an inherent jurisdiction to grant Mareva relief in relation to assets in Australia in aid of foreign proceedings.
51 The High Court of Australia appears to have refined the Mareva order in recent years in three ways: first, it has held that such an order is not an injunction and that the power to grant it may be impeded by forcing it into the injunction mould; second, superior Courts have inherent jurisdiction to make freezing orders to prevent the frustration of their process. The view is open, and should be embraced, that those processes include the enforcement of a foreign judgment when obtained in the Australian Court and that in the meantime a freezing order may be made to prevent the frustration of that process, see Cardile's case (supra); Australian Broadcasting Corp v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 243.
52 Further, it seems that the limits of the Mareva order are determined by the dictates of equity and good conscience by analogy with an anti-suit injunction. They are both applications of the Court's power to protect the integrity of its processes: CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345 at 391 and 394.
53 The author of one leading text suggests that in Australia the Mareva jurisdiction is sufficiently flexible that there is power to grant such relief
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- in aid of foreign proceedings at least where a foreign judgment has been obtained or is being sought and is being or will be enforced in Australia under the Foreign Judgments Act (1991) (Cth) or otherwise and at least where there are assets within the territorial jurisdiction of the Australian Court against which execution may be available. The thesis is that legislation is unnecessary to found this power. See Biscoe: "Mareva and Anton Piller Orders: Freezing and Search Orders" at par 5.48.
54 The same text is of assistance to me when I look at the position of a third party such as Austock, being the second-named respondent in the present case. Biscoe has this to say at par 6.11, and I quote:
"[6.11] Where a freezing order is sought against a third party (against whom no final substantive relief is claimed) special considerations arise which have been addressed in Chapter 4 to which reference should be made. Of cardinal importance is Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 405[57] where it was held that the activities of third parties may be restrained in circumstances in which:
(a) the third party holds, is using, or has exercised or is exercising a power of disposition over, or is otherwise in possession of, assets of the defendant; or
(b) some process, ultimately enforceable by the courts, is or may be available to the applicant as a consequence of a judgment against the defendant pursuant to which, whether by appointment of a liquidator, trustee in bankruptcy, receiver or otherwise, the third party may be obliged to disgorge property or otherwise contribute to the funds or property of the defendant to help satisfy any judgment against the defendant."
56 Having regard to my review of the decided cases, I am prepared to accept that in certain circumstances Australian superior courts have an inherent jurisdiction to grant Mareva relief in relation to assets in Australia where a foreign judgment has been or is to be obtained. Nonetheless I am conscious that the general rule is that jurisdiction of the Supreme Court is territorial and the normal rules of comity amongst
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- nations require that this Court must endeavour to act consistently with the procedural and substantive requirements in the country of the original Court, Siskina, Owners of the Cargo on board the v Distos Compania Naviera SA [1979] AC 210 per Lord Diplock at 254.
57 I give weight also to the precept enunciated in various cases that the rationale for Mareva relief is related to an abuse of process. This influenced the reasoning of Murray J in Raveh's case to the effect that an order should not be made where the relief has no connection with the enforcement of a substantive right in proceedings taken by the plaintiff in this Court.
58 It emerges from earlier discussion that Celtic is not presently in a position to enforce the judgment it has obtained in the United Kingdom as Arduina has not been served and has therefore not been afforded an opportunity to apply to set aside the judgment in the manner allowed to it by the procedural rules in the country of origin. For that reason the judgment cannot yet be registered in Western Australia.
59 In my view it would circumvent and be inconsistent with the prescribed procedure in the country of origin if a Mareva order was made of the kind proposed which indirectly had the effect of enforcing the judgment in question or, putting it another way, made provision for the judgment to be enforced in due course by ensuring that the assets of the judgment debtor are not dissipated.
60 I distinguish what was said by Campbell J in the Davis case (supra) in that the circumstances in that case did not give rise to a perceived inconsistency between the procedural requirements of the country of origin in regard to a suspension period after service of the judgment before enforcement could take place. Moreover, in circumstances where the judgment cannot be presently registered in this State, it cannot be said that there is as yet any abuse of process or likely abuse of the process in this Court, especially in circumstances where the underlying cause of action does not appear to be enforceable by or have any connection with proceedings commenced in this Court.
61 For all these reasons, after weighing up the dictates of equity and good conscience, I do not consider that a sufficient case for Mareva relief has been made out. In addition, it cannot be said that Celtic has shown a good arguable case that the rights vested in it by virtue of the judgment will be enforceable in this state at a time when the judgment has not been and cannot yet be registered in this state, notwithstanding the substantial
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- body of evidence before me that the judgment has the potential to be registered in this state eventually. These observations apply with equal force to Austock.
62 This conclusion, which weighs against the exercise of the discretionary power to grant Mareva relief makes it unnecessary for me to proceed to the further question as to whether there is a real risk of Arduina's assets being dissipated. I will make no finding as to that.
63 In summary, then, the application to register the foreign judgment and the Mareva application will be dismissed. This makes it unnecessary to rule upon the further application for service out of the jurisdiction or to determine the scope and terms of the proposed orders.
Key Legal Topics
Areas of Law
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Private International Law
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International Trade Law
Legal Concepts
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Jurisdiction
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Foreign Judgments
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Abuse of Process
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Injunction
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