La Jolla Cove Investments v Go Connect Limited
[2014] NSWSC 988
•23 July 2014
Supreme Court
New South Wales
Case Title: La Jolla Cove Investments v Go Connect Limited Medium Neutral Citation: [2014] NSWSC 988 Hearing Date(s): 23 July 2014 Decision Date: 23 July 2014 Jurisdiction: Common Law Before: Hamill J (as Duty Judge) Decision: The defendant is ordered to pay the plaintiff the following:
(a) US$970,000.
(b) US$54,672.12, (interest on $US970,000 at the rate of 9.75 per annum from 24 December 2013 to the date of these orders).
(c) The plaintiff's costs as agreed of and incidental to these proceedings.
Catchwords: CIVIL LAW - enforce foreign judgments - enforce judgment from United States District Court - ex parte - consent to jurisdiction - consent to foreign jurisdiction - settlement agreement - fixed debt - United States jurisdiction Legislation Cited: Foreign Judgments Act 1991 (Cth)
Service and Execution of Process Act 1992 (Cth)Cases Cited: Bhushan Steel Pty Limited v Severstal Exports [2012] NSWSC 587 Category: Principal judgment Parties: Plaintiff: La Jolla Cove Investments
Defendant: Go Connect LimitedRepresentation - Counsel: Counsel:
Plaintiff: P Holmes
Defendant: No appearance- Solicitors: Solicitors:
Plaintiff: Allens
Defendant: No appearanceFile Number(s): 2014/136575 Publication Restriction: Nil
EX TEMPORE JUDGMENT
HAMILL J: This is an application by the plaintiff for an order allowing it to enforce a judgment of the United States District Court Southern District of California. I will refer to that as the Californian Court.
The plaintiff is a United States corporation. The proceedings in this Court were commenced by summons on 6 May 2014 and on 9 July 2014 Davies J ordered that the matter be listed for hearing today. Certain other procedural orders were also made.
The plaintiff is ably represented by Mr Patrick Holmes. The defendant is not represented and has not appeared this morning. Accordingly the first question that I have to consider was whether I should proceed ex parte. In relation to that question, the plaintiff relied on two affidavits. The first is an affidavit of Emmanuel Sayanos sworn on 9 May 2014. That affidavit establishes that on 8 May 2014 the initiating process, which is to say the summons, as well as the appropriate form under the Service and Execution of Process Act 1992 (Cth), an affidavit of Mr Huff affirmed 2 May as well a letter from the plaintiff's solicitor were served on the defendant and specifically on a person called Richard Ly who agreed that he was authorised to accept service on behalf of the defendant.
The second affidavit is an affidavit of the plaintiff's solicitor, Mr Dunnicliff. That affidavit establishes that since service of the initiating process and associated documents he has been in contact or communication with a law firm in Melbourne which has been retained by the defendant.
Annexed to Mr Dunnicliff's affidavit are emails from the law firm which I gather is called Stretch Legal and they show that the defendant was (at least initially) represented, that they were aware of the proceedings, that they sought an adjournment to which the plaintiff consented and that they were advised of the orders made by Davies J on 9 July 2014 and specifically were aware of today's date.
In those circumstances and given those facts I indicated to Mr Holmes that I was prepared to proceed with the application ex parte which brings me to the substance of the application. Mr Holmes has carefully taken me through two affidavits which establish the facts upon which the application is based. Those affidavits are the affidavit of Travis Huff of 2 May 2014 to which I referred earlier and the affidavit of Nicholas Morgan dated 21 July 2014.
Each of those affidavits annexes relevant documentation in respect of the substance of the original claim and the processes of litigation before the Californian Court.
I do not need to go through the material as meticulously as Mr Holmes did but I think it is necessary to at least set out some of the critical dates and facts. On 2 June 2011 the plaintiff and defendant entered into a funding agreement. The defendant defaulted in the terms of that funding agreement and on 23 August 2011 the plaintiff commenced proceedings in the Californian Court. On 27 October 2011 the defendant filed a defence and counter claim. Importantly in that document the defendant accepted that "this court" (being the Californian Court) has personal jurisdiction over the parties pursuant to certain provisions to which I need not refer.
On 30 November 2012 the parties reached a settlement agreement and that is a document of some length. It is not necessary to refer to it in terms other than to note that it incorporated what it described as a "stipulated agreement" whereby if the defendant complied with the settlement agreement, the plaintiff would withdraw the proceedings before the Californian Court and, alternatively, if the defendant failed to comply with the terms of the settlement agreement the plaintiff could apply for a judgment in accordance with the stipulated agreement.
By those documents the defendant plainly accepted the jurisdiction of the Californian court but if there was any doubt in relation to that it has specifically signed a document which incorporates a consent to jurisdiction by a United States Magistrate Judge and that document is at p 62 of the affidavit of Mr Huff.
On 24 December 2013 the plaintiff sought and obtained judgment before the Californian Court. The defendant had not complied with its obligation under the settlement agreement so the stipulated agreement came into effect.
The orders made by the United States Magistrate Judge Jan M Adler were as follows;
"It is hereby ordered, adjudged and decreed that judgment may be entered pursuant to the terms of the settlement agreement between the parties as follows: Defendant Go Connect Limited an Australian Corporation due to its default shall pay plaintiff La Jolla Cove Investments Inc the sum of $970,000 plus accrued interest at 9.75 per cent annually plus costs and reasonable attorney's fees incorporated in enforcing this judgment."
There is specific legislation concerning the enforcement of foreign judgments and that is the Foreign Judgments Act1991 (Cth). By s 5 of that Act only countries and jurisdictions nominated and the regulations are caught.
The United States of America is not a country referred to in the regulations. Accordingly the application is to be dealt with under the common law. In Bhushan Steel Pty Limited v Severstal Exports [2012] NSWSC 583 Sackar J said at [146] to [147]:
"The principles governing enforcement of Judges are at common law well known. In order to entitle a foreign judgment to recognition at common law four conditions must be satisfied (Davies, Bell and Brereton, 'Nygh's Conflicy of Laws in Australia' (8th ed. 2010) ch 40 (see [40.2 in particular)):
(a)The foreign court must have exercised the jurisdiction that Australian courts recognised.
(b) The foreign judgment must be final and conclusive.
(c) There must be an identity of the parties, and
(d) If based on a judgment in personam the judgment be for a fixed debt.These criteria derive from a range of cases at common law and were approved for example by the Full Court of the Supreme Court of South Australia in Benefit Strategies Group Inc v Prider (2005) 91 SASR 544."
His Honour then went on to explain where such principles were derived. The material before the Court this morning comfortably satisfies each of those criteria. I have already referred to the acceptance by the defendant of the jurisdiction of the Californian Court, the critical matter in considering the criteria (a) in the judgment of Sackar J.
There is little doubt that the foreign judgment was a final and completed one, that the parties were clearly identified and that the judgment was for a fixed debt. In those circumstances I propose to make the orders sought by the plaintiff.
The defendant is ordered to pay the plaintiff the following:
(a)US$970,000.
(b)US$54,672.12 (interest on $US970,000 at the rate of 9.75 per annum from 24 December 2013 to the date of these orders).
(c)The plaintiff's costs as agreed and incidental to these proceedings.
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