IPCO Constructors Pty Ltd v McConnell Dowell Corporation Ltd
[1996] FCA 52
•15 Feb 1996
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION No VG 531 of 1995
BETWEEN:
IPCO CONSTRUCTORS PTE LTD
and IPCO MARINE LIMITED
Applicants
-and-
McCONNELL DOWELL CORPORATION LIMITED and
McCONNELL DOWELL PTY LTD
Respondents
Coram: Olney J
Place: Melbourne
Date: 15 February 1996
REASONS FOR JUDGMENT
By notice of motion filed on 8 December 1995 the respondents seek orders inter alia that the applicants' further amended statement of claim in this proceeding be struck out on the grounds that it is embarrassing and may delay the fair trial of the proceeding or alternatively that the applicants provide further particulars of the proper law of the causes of action pleaded.
The proceeding was commenced on 8 May 1995. The application is expressed as having been made pursuant to s 36 of the Copyright Act 1968. The applicants claim inter alia declaratory and injunctive relief and damages (alternatively, an account of profits) for infringement of copyright, damages (alternatively, an account of profits) for misuse of confidential information, and damages for wrongful inducement or procuration of breach of contract.
A statement of claim was filed with the application. It has since been amended on two occasions most recently by the filing on 1 November 1995 of the further amended statement of claim referred to in the respondents' motion.
The further amended statement of claim (hereafter referred to as the statement of claim) is a substantial document but for present purposes it is not necessary to canvass its contents exhaustively. It will be sufficient to summarise the essential facts pleaded insofar as they are relevant to the matter under consideration.
The first applicant (IPCO Singapore) is a Singapore company and the second applicant (IPCO Hong Kong) is a Hong Kong company. The applicant companies will be referred to collectively as IPCO. The first respondent (MDC) is an Australian company incorporated in the ACT and the second respondent (MD) is an Australian company incorporated in Victoria.
IPCO's principal business is the development of and investment in infrastructure including design, engineering and construction of major infrastructure projects which it operates in various countries including Singapore and Thailand.
By an agreement made pursuant to the law of Thailand in or about late 1989 or early 1990 between IPCO and a Thai company Si Chang Thong Terminal Company Limited (SCTT) (the first agreement) IPCO agreed to undertake a feasibility study, a site investigation, and the design of a deep sea port in Thailand and to construct the deep sea port if it proceeded to construction (the SCTT project). Pursuant to the agreement IPCO prepared a feasibility study and an information memorandum for which it was paid by SCTT.
In 1991 IPCO entered into a further agreement (the second agreement) with SCTT pursuant to the law of Thailand whereby IPCO agreed to carry out the further design of all of the marine related works for a redefined and reduced scope of works to be phase one of the development of the deep sea port (the phase one development) and to construct the phase one development if it proceeded to construction. Pursuant to the second agreement IPCO created certain designs and engineering specifications (the copyright works) in respect of which IPCO Singapore claims to be the owner of the copyright. Pursuant to the agreements, the copyright works were submitted to SCTT for review. SCTT has made no payment to IPCO for them.
In late 1993 the respondents, without the licence or authority of IPCO, obtained the copyright works from SCTT for the purpose of inducing SCTT to grant to the respondents, or a company associated with them, the contract for the completion of the design and construction of the phase one development, and without the licence or authority of the applicants the respondents have reproduced and published technical drawings incorporating IPCO's design and engineering specifications and substantially reproducing IPCO's drawings (the infringing works). The respondents knew that the creation of the infringing works constituted an infringement of IPCO's copyright in the copyright works and have knowingly and wilfully infringed that copyright.
On or about 14 January 1994 SCTT made an agreement with MD and McConnell Dowell (Thailand) Ltd (MD Thailand) in relation to the design and construction of the phase one development.
The technical information and/or know-how contained in the copyright works is the property of IPCO and confidential to IPCO (the confidential information). Pursuant to the second agreement IPCO communicated the confidential information to SCTT in circumstances which imposed on SCTT an obligation to keep it confidential. It was an implied term of the second agreement that the confidential information would not be disclosed by SCTT to any competitor of IPCO or any other person without IPCO's prior consent. SCTT wrongfully supplied, or alternatively, the respondents induced SCTT to supply, the confidential information to the respondents who have wrongfully and knowingly used the confidential information to obtain the contract for the design and construction of the phase one development to the exclusion of the rights of IPCO.
At all material times the respondents well knew that SCTT had engaged IPCO to construct the phase one development and in or about late 1993 wrongfully induced or procured SCTT to breach its agreements with IPCO and to appoint MDC and MD Thailand to design and construct the phase one development instead.
Whether or not the first agreement and the second agreement exist is fundamental to the several causes or action pleaded. The respondents say that if the alleged contracts do exist, it is essential to ascertain the law which governs their formation and interpretation. The applicants have pleaded in each case that the contracts were made pursuant to the law of Thailand and have conveyed by letter to the respondents' solicitors that they will allege, to the extent that it is relevant, that the law of the contract is Thai.
The respondents say that because the causes of action have a substantial foreign component the applicants are required to plead in their statement of claim -
the statute, code, rule, regulation, ordinance or case law which gives rise to the contracts alleged;
ii)whether the law of contract in Thailand contains any special provisions dealing with confidential information or whether there are provisions or there is case law in Thailand which protect the confidentiality of alleged confidential information or which provide remedies for breach of confidence;
iii)if any foreign law of confidential information is relied on, what are the relevant statutes, codes, rules, regulations, ordinances, or case law and the relevant provisions or pages;
iv)whether the law of Thailand or the law of Singapore imposes copyright protection for designs and engineering specifications and provides remedies for breach of copyright; and
if any foreign law of copyright is relied on, what are the relevant statutes, codes, rules, regulations, ordinances, treaties, or case law and the relevant provisions or pages.
Counsel for the respondents relies upon the statement in Bullen, Leake and Jacobs Precedents of Pleading (13th Edition) 1990 at p 1170 that -
Where a party relies on foreign law to support his claim or as a ground of defence thereto, he must specifically plead the foreign law relied on in his Statement of Claim or Defence and he should give full particulars of the precise statute, code, rule, regulation, ordinance or case law relied on, with the material sections, clauses or provisions thereof.
and the following passage from Sykes and Pryles, Australian Private International Law (3rd Edition) 1991 at p 267 -
In Anglo-Australian private international law, foreign law is treated as fact not law. Thus, as a general rule, foreign law must be pleaded as a fact by the party who seeks to rely on it ... The burden of proving foreign law rests upon the party who bases his claim or defence upon it.
The general thrust of the respondents' argument is that they are entitled to know how the alleged agreements are formulated under Thai law, whether they are enforceable in Thailand, and whether, for example, Thai law allows for the implication of terms and on what basis.
In support of their argument the respondents rely upon the following extract from a decision of Beaumont J in Allstate Insurance Company v ANZ Banking Group Ltd (Federal Court; 13 September 1994; unreported):
In order that the respondents might properly file a defence to the claims made, they were in my opinion entitled to know at least the following in respect of each cause of action pleaded:
(a) ...
(b)in respect of that aspect of a claim which involves a foreign element -
i)How is it said that the claim is justiciable in this Court?
ii)Where, in substance, is the act or omission complained of said to have occurred? If this is a question of mixed fact and law, identify the facts relied on, together with any law, domestic or foreign relied on. In the case of foreign law, ... refer to the provisions of any foreign statute and any decisions interpreting those provisions, together with any relevant exposition of the general law of the foreign country by decided cases or other authority;
iii)...
iv)if the conflicts of laws rules of the common law of Australia are relied upon, what are those rules, and what are the facts that attract those rules ...
The respondents say that the statement of claim does not identify any proper law in respect of the claim for infringement of copyright nor state where the copyright works were created.
Further, in respect of the claim for breach of confidence, the respondents say that the applicants must plead whether the Thai law of contract contains or implies an obligation of confidence and whether there exists in Thailand any law equivalent to the equitable principles and procedures by which the obligation of confidentiality is enforced on third parties in Australia.
The respondents make the point that the claim for wrongfully inducing or procuring SCTT to breach agreements made with the applicants is a cause of action in tort and that although the general rule is that it is for a respondent to plead any defence to a claim in tort which relies upon foreign law being different from Australian law, this case is different because the tort in question depends upon the nature and existence of contracts made in Thailand and it is said that the relevant Thai law of contract must be pleaded as otherwise the respondents do not know precisely the terms and effect of the contracts. Another issue raised is that it is said that the applicants have not pleaded that the respondents had the requisite intention to procure the breach of contract and as this is an essential element of the tort the pleading does not disclose a cause of action.
A further and quite separate matter raised by the respondents relates to paragraph 20 of the statement of claim which pleads the contract of 14 January 1994 between SCTT and MD and MD Thailand. It is said that the statement of claim makes no further reference to this contract and does not plead any conclusion derived from it. With respect, I disagree with the respondents' assertion that paragraph 20 should be struck out as embarrassing and irrelevant. The fact that SCTT entered into the pleaded contract is an essential part of the chronology of events upon which the applicants base their claim for inducing or procuring a breach of contract. The
contract is specifically referred to particulars pleaded in this context.
The applicants rely upon the proposition that the burden of proving foreign law lies on the party who bases its claim or defence on it and if that party adduces no evidence, or insufficient evidence, of the foreign law, the Court will apply Australian law.
Reference has been made in argument to numerous authorities in support of this proposition including:
Lloyd v Guilbert and others (1865) LR 1 QB 115 at 129
The Parchim (1918) AC 157 at 161
United States Surgical Corporation v Hospital Products International Pty Ltd (1982) 2 NSWLR 766 at 799
Dynamit Actien-Gesellschaft v Rio Tinto Co Ltd (1918) AC 292 at 294-5
David Syme & Co Ltd v Grey 115 ALR 247 at 268
Hunter Grain Pty Ltd v Hyundi Merchant Marine Co Ltd 117 ALR 507 at 525
P.E. Nygh Conflict of Laws in Australia; (6th Edition) at 362
Cheshire and North, Private International Law (12th Edition) at 107
Sykes and Pryles, Australian Private International Law (3rd Edition) at 276
Dicey and Morris, The Conflict of Laws (11th Edition) at 227-8
The applicants' argument on this question is unassailable and a proper consideration of the authorities provides the answer to the apparent contrary opinion expressed by Beaumont J in Allstate Insurance to which reference is made above. In that case the applicants based their case on foreign law and it was entirely consistent with authority that they should be required to plead in the manner required by Beaumont J. If the quoted passage from Allstate Insurance is to be treated as authority for any other proposition than that relied upon by the applicants I would decline to follow it.
Since these reasons were prepared in draft the respondents' counsel has by letter sought leave (which I granted) to tender a written submission in reply. A copy of the submission accompanied the letter. The applicants' counsel has sought and been granted the right of reply.
The thrust of the respondents' submission in reply is that by pleading in respect of each of the first contract and the second contract that the contract was made pursuant to the law of Thailand, the applicants have invoked foreign law and thereby carry the burden of proving that law. So far as it goes that submission is unobjectionable. But it does not follow that by assuming the burden of proof the applicants must plead particulars of the foreign law. The authorities make it clear that if the party who relies upon foreign law adduces no evidence, or insufficient evidence of the foreign law, the Court will apply Australian law. As foreign law is a question of fact and the applicants have not pleaded any facts in relation to it, they would not be able to lead evidence at trial as to the provisions of Thai law. (Ascherberg, Hopgood & Crew Ltd v Casa Musicale Sonzogno etc (1971) 1 WLR 173 at 178: (1971) 1 WLR 1128). If the respondents say that the law of Thailand is relevantly different from Australian law they must plead accordingly and provide adequate proof.
There is no substance in the point raised by the respondents as to the absence of a plea of intention in relation to the tort of inducing or procuring a breach of contract. It is sufficient that the applicants plead knowledge (see Allstate Life Insurance Co v ANZ Banking Group Ltd 130 ALR 469 at 486). This they have done at paragraph 30 of the statement of claim.
The applicants in their application have clearly indicated that they bring the action for infringement of copyright under Australian law. Further, they have referred in argument to Regulation 4 of the Copyright (International Protection) Regulations and Schedule 1 Part III thereof whereby copyright works created in Singapore are protected. If the applicants' particulars are deficient as to the place it is alleged the works were created or the place where reproduction thereof is alleged, the appropriate action is to seek further and better particulars of the pleading.
In my opinion the respondents' motion should be dismissed.
I certify that this and the preceding 10 pages are a true copy of the Reasons for Judgment of the Honourable Justice Olney
Associate:
Dated:
Heard: 8 February 1996
Place: Melbourne
Judgment: 15 February 1996
Appearances:
Mr R. Kendall (instructed by Clayton Utz) appeared for the respondents (in support of the motion).
Mr D. Shavin QC and Ms M. Barker (instructed by Freehill Hollingdale & Page) appeared for the applicants (in opposition to the motion).
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