Ewing International LP v Ausbulk Ltd - [2010] SASC 142

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
EWING INTERNATIONAL LP v AUSBULK LTD
[2010] SASC 142
Reasons for Decision of The Honourable Justice Layton
13 May 2010
ARBITRATION - CONDUCT OF THE ARBITRATION PROCEEDINGS - TERMINATION OR STAY OF ARBITRATION PROCEEDINGS
PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - JURISDICTION AND GENERALLY
PROCEDURE - DISCOVERY AND INTERROGATORIES - DISCOVERY AND INSPECTION OF DOCUMENTS - PRODUCTION AND INSPECTION - GROUNDS FOR RESISTING PRODUCTION - LEGAL PROFESSIONAL PRIVILEGE
Interlocutory applications by the defendant seeking a stay of arbitration proceedings between the parties, leave to issue subpoenas and provision of a Kadlunga list – parties in arbitration in relation to a dispute about silo contracts – those contracts had also been the subject of litigation before the Court regarding performance guarantees - the Court found that the parties made a contract requiring the plaintiff to procure performance guarantees – the Court ordered that the plaintiff do all things necessary to procure performance guarantees – whether the defendant can call on guarantees was an issue to be determined at arbitration - at the time of hearing of the application no guarantees had been obtained – arbitrator indicated he was ready to deliver his award – defendant sought stay of arbitrator’s decision pending outcome of order to issue subpoenas – whether s 47 of the Commercial Arbitration and Industrial Referral Agreements Act 1986 (SA) confers jurisdiction on the Supreme Court to order stay of arbitration proceedings – whether discretion to order a stay should be exercised – defendant seeks order requiring plaintiff to provide a Kadlunga list.
Held: there was no substantive application before the Court to which the application for subpoenas and the Kadlunga list related - application to issue subpoenas dismissed – no certainty that documents sought by way of subpoena exist – documents held by banks relate to the banks’ own internal decision processes and are not relevant to whether the plaintiff has taken all reasonable steps to procure guarantees – s 47 provides jurisdiction in the circumstances of this case to temporarily stay the decision of the arbitrator – application for stay necessarily dependent on application for issue of subpoenas – Court should not exercise its discretion to order a stay – application for Kadlunga list dismissed.
Commercial Arbitration and Industrial Referral Agreements Act 1986 (SA) s 47; Supreme Court Rules 2006 (SA) r 192, referred to.
Andrew Garrett Wine Resports v NAB (No 6) (2005) 92 SASR 419, applied.
Proprietors of Strata Plan 3771 v Travmina Pty Ltd (1986) 4 BCL 91; In the matter of the Commercial Arbitration Act 1986; South Australian Superannuation Fund Investment Trust v Leighton Contractors Pty Ltd (1990) 55 SASR 327, discussed.
Imperial Leatherware Co Pty Ltd v Macri and Marcellino Pty Ltd (1991) 22 NSWLR 653; Baulderstone Hornibrook Engineering Pty Ltd v State Constructions Pty Ltd (1993) 171 LSJS 426; State Constructions Pty Ltd v Baulderstone Hornibrook Engineering Pty Ltd [1997] SASC 6090; Kadlunga Proprietors v Electricity Trust of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read Ewing International LP v Ausbulk Ltd and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2010] SASC 142
Decision Date: 13 May 2010

CaseChat Overview and Summary

Ewing International LP v Ausbulk Ltd involved a dispute between the parties relating to silo contracts that were also the subject of litigation before the Supreme Court of South Australia regarding performance guarantees. Ausbulk sought to stay the arbitration proceedings, obtain leave to issue subpoenas, and require the plaintiff to provide a Kadlunga list. The substantive application, FDN 65, was contingent on Ausbulk being successful in obtaining leave to issue subpoenas in FDN 69. The Kadlunga list was a separate argument, and the application for various directions in FDN 76 depended on the success of the subpoena application.

The legal issues the court was required to decide included whether section 47 of the Commercial Arbitration and Industrial Referral Agreements Act 1986 (SA) conferred jurisdiction on the Supreme Court to order a stay of the arbitration proceedings, whether the discretion to order a stay should be exercised, and whether the defendant could compel the plaintiff to provide a Kadlunga list. The court had to consider the implications of its previous decisions and the current state of the arbitration proceedings.

The court found that the parties had made a contract requiring the plaintiff to procure performance guarantees. The court ordered that the plaintiff do all things necessary to procure performance guarantees, and the issue of whether the defendant could call on such guarantees was to be determined at arbitration. Since no guarantees had been obtained at the time of the hearing, and the arbitrator was ready to deliver his award, the court considered the application for a stay. The court dismissed the applications, finding that the discretion to order a stay should not be exercised in these circumstances. Additionally, the court did not compel the plaintiff to provide a Kadlunga list.

The court dismissed the four applications made by Ausbulk, being FDN 65, FDN 69, FDN 76, and FDN 80. The reasons for the dismissal were based on the court's previous decisions, the current state of the arbitration proceedings, and the lack of necessity to exercise the discretion to order a stay.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

The substantive application was FDN 65, seeking a stay of the arbitration award, and that application in turn was reliant upon Ausbulk being successful in the application for the issuing of subpoenas in FDN 69. Put another way, if Ausbulk was not successful in obtaining leave to issue the subpoenas, then likewise, the application for a stay pending receipt of the product of such subpoenas would no longer apply. The Kadlunga list was a separate argument and, indeed, the application for various directions in FDN 76 in turn hinged upon the success of the application for leave to issue the two subpoenas.Background Ausbulk’s applications arise in circumstances of complex litigation which has been the subject of three decisions with detailed reasons given by me on 8 February 2008,[2] 6 October 2009[3] and 9 December 2009.[4] It is the third of those decisions, given on 9 December 2009, which is the focus of the present applications. [2] Ewing International LP v Ausbulk Ltd & Anor (2008) 253 LSJS 195.[3] Ewing International LP v Ausbulk Ltd [2009] SASC 317.[4] Ewing International LP v Ausbulk Ltd (No 2) [2009] SASC 381. The background facts are set out in my reasons for decision of 9 December 2009.[5] The immediate matters giving rise to the applications are the orders which were made by me on that occasion, which were expressed as follows:[6]1A declaration that the parties entered into a contract on 20 February 2008, the terms of which are set out in [151] of these reasons.2That, in accordance with the contract of 20 February 2008, the plaintiff do all that is reasonably necessary so as to procure bank guarantees in substitution for the Replacement Guarantees annexed to the order of the Court dated 26 February 2008 and marked A and B respectively, such guarantees to be rolled over or substituted from time to time until determination of the Arbitration or further order of this Court.3Liberty to the parties to apply in the event that Ewing is unable to procure bank guarantees within a named period of time.[5] Ewing International LP v Ausbulk Ltd (No 2) [2009] SASC 381, [1]-[25].[6] Ewing International LP v Ausbulk Ltd (No 2) [2009] SASC 381, [389]. Paragraph [151] referred to in order 1 above was in the following terms:I find that there was a contract between the parties as at 20 February 2008. The terms of that contract were as follows:1.that Ewing would ensure that bank guarantees would remain in place until after the determination of the Arbitration.2.that Ausbulk would not call on any such bank guarantees until after the determination of the Arbitration.3.that Ewing would tender substitute bank guarantees (rolled over for a fixed period of not less than 12 months) no less than one month before the expiry date of each guarantee.4.that in the event that Ewing failed to tender such substitute bank guarantees by such date, subject to further order, Ausbulk was at liberty to present the guarantees for payment.5.that the parties would consent to orders by the Court which set out the above four terms.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Given that the third application, FDN 76, does not propose any significant orders in addition to the other applications, it follows from the dismissal of those applications that FDN 76 should also be dismissed.Conclusion In conclusion, for the reasons that I have given, I would dismiss the four applications made by Ausbulk, being FDN 65, FDN 69, FDN 76 and FDN 80.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.