Lighthouse Corporation Ltd v Timor Leste - [2019] VSC 278

59 VR 492

LIGHTHOUSE CORPORATION LTD and Another v REPUBLICA DEMOCRATICA DE TIMOR LESTE and Another Supreme Court of VictoriaAlmond J 20-21 June 2018, 02 May 2019[2019] VSC 278Practice and procedure — Jurisdiction — Contract — Foreign State — Act of state — Whether doctrine of act of state applicable — Forum non conveniens — Whether Victoria clearly inappropriate forum for determination of claim — Foreign States Immunities Act 1985 (Cth), ss 9, 11.

The plaintiffs alleged that they entered into a fuel supply agreement with the defendants and that the defendants had breached and repudiated the agreement. The defendants, the state of Timor Leste and a state-owned utility company, sought orders that the proceeding be set aside, dismissed, or otherwise permanently stayed. The application was made on the basis that the Court had no jurisdiction because the claims concerned Acts of State, or alternatively that Victoria was a clearly inappropriate forum for the resolution of the dispute.

Held, dismissing the application:

Act of State

(1)
The act of state doctrine was not engaged.
- (a)
  The subject matter of the proceeding was a commercial transaction. A transaction did not become an act of state merely because a state was party to it or a member of the executive executed the transaction. Nor did it become an act of state merely because a public benefit was intended or received from it. [48]–[52].
  Moti v The Queen (2011) 245 CLR 456, 475, 476[50]–[52] applied.Underhill v Hernandez (1897) 168 US 250, 252; Habib v Commonwealth (2010) 183 FCR 62, 66, 77, 86 referred to.
- (b)
  Even if the inquiry might incidentally expose that there had been an unlawful or inappropriate act by Timor Leste, that would only be incidental or preliminary to the determination of the question in this case. It would not offend the act of state doctrine. [53].
  Attorney General (UK) v Heinemann Publishers Australia Pty Ltd (1988) 165 CLR 30, 34; Moti v The Queen (2011) 245 CLR 456 applied.Belhaj v Straw [2017] AC 964, 1111–12, 1116, 1154 followed.
- (c)
  The act of state doctrine could not operate in a way which negated the exception for commercial transactions in s 11 of the Foreign States Immunities Act 1985 (Cth). [56]–[57].

Forum

(2)
Victoria was not a clearly inappropriate forum for determination of the dispute. There were significant connecting factors to Victoria. Disputed questions as to whether the contract was made, and whether it included the term that the contract was to be governed by the law of Victoria, were matters for the law of the forum. [87].

doi: 10.25291/VR/59-VR-49259 VR 493

(2)Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197, 225, 241, 242–4, 261; Voth v Manildra Flour Mills Pty Ltd(1990) 171 CLR 538,

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.

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Details

Case: [2019] VSC 278
Decision Date: 02/05/2019

CaseChat Overview and Summary

This proceeding involved an application by the defendants to the Supreme Court of Victoria to dismiss or stay the proceeding. The plaintiffs alleged that they had entered into a fuel supply agreement with the defendants, and that the defendants had breached and repudiated the agreement. The defendants sought orders that the proceeding be set aside, dismissed, or otherwise permanently stayed on the basis that the Court had no jurisdiction because the claims concerned Acts of State, or alternatively that Victoria was a clearly inappropriate forum for the resolution of the dispute. The court held that the act of state doctrine did not apply because the subject matter of the proceeding was a commercial transaction. The court also held that Victoria was not a clearly inappropriate forum for the resolution of the dispute. There were significant connecting factors to Victoria, and the disputed questions as to whether the contract was made and whether it included the term that the contract was to be governed by the law of Victoria were matters for the law of the forum. The application was dismissed.

Orders