Court of Appeal
Supreme Court
New South Wales
Medium Neutral Citation: Michael Wilson & Partners Ltd v Emmott [2021] NSWCA 315 Hearing dates: 20 July 2021; Further Submissions 23, 27 July, 1, 22 September, 12, 28 October 2021 Date of orders: 17 December 2021 Decision date: 17 December 2021 Before: Leeming JA at [1];
Brereton JA at [8];
Emmett AJA at [127]Decision: (1) Dismiss the appellant’s motion of 14 September 2021, with costs;
(2) Grant leave to appeal;
(3) Allow the appeal;
(4) Set aside the orders made in the Commercial List of the Equity Division on 8 March 2019 and in lieu thereof:
(a) Grant leave under Uniform Civil Procedure Rules 2005 (NSW), r 11.5, to the plaintiff to serve the proceedings on the defendant outside Australia and in England, insofar as it relates to the claims for relief in paragraphs 3 to 10 of the Further Amended Summons of 3 October 2018;
(b) Order that proceedings on the Further Amended Summons other than in respect of the claims referred to in (a) be permanently stayed;
(c) Otherwise dismiss Mr Emmott’s motion filed on 1 November 2018; and
(d) No order as to costs of the motion, to the intent that each party bear its own costs; and
(5) Save insofar as any interlocutory costs order otherwise provides, no order as to costs of the appeal, to the intent that each party bear its own costs.
Catchwords: PRIVATE INTERNATIONAL LAW – Jurisdiction – Personal jurisdiction – Service outside of the jurisdiction – Partnership and contribution claims by corporate appellant as assignee of the rights of the trustees in bankruptcy of two former business associates of respondent – Respondent and two associates previously members of appellant firm operating in Kazakhstan but departed to establish competitor – Prior arbitration in London between appellant and respondent – Prior proceedings in Australia by appellant against two associates – Appeal from permanent stay of claims pursuant to rules for service outside of Australia
PRIVATE INTERNATIONAL LAW – Jurisdiction – Personal jurisdiction – Service outside of the jurisdiction – Connecting factors – Person outside of Australia a defendant to a claim for contribution or indemnity in respect of a liability enforceable by a proceeding in the court – Whether insufficient prospects of success to warrant service – Whether amount in issue only approximately USD$2,000 – Whether any right of contribution – Appeal on contribution claim dismissed
PRIVATE INTERNATIONAL LAW – Orders with extraterritorial effect – Anti-suit injunctions – Anti-suit injunction restraining claims previously determined and adverse findings previously made by arbitration in London – Interpretation of arbitral award – Majority of aspects of contribution claim covered – No error in finding that claim could only amount to USD$2,000
EQUITY – Contribution – Exclusion of right – Knowing assistants – Persons with liabilities not of same nature and extent not entitled to contribution – Persons without clean hands not entitled to contribution – Previous High Court proceedings identified two associates as knowing assistants in dishonest…
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- Case
- [2021] NSWCA 315
- Decision Date
CaseChat Overview and Summary
The central legal issues before the court were whether the appellant should be granted leave to serve proceedings on the respondent outside of Australia, and whether certain claims, particularly those for contribution or indemnity, were valid and should proceed. This involved determining whether there was a sufficient connection to Australia to justify the exercise of jurisdiction, the applicable law for partnership claims, and the effect of prior arbitration and litigation on the current claims. The court also considered whether the claims for contribution were sustainable given the bankruptcy of the associates and the findings of dishonest conduct in previous proceedings.
The court reasoned that while some of the appellant's claims, particularly those for contribution and indemnity, were unsustainable due to the bankruptcy of the associates and findings of dishonest assistance, a real and substantial connection to Australia was established by evidence of partnership assets located in Australia, including engagement contracts, receipts, and Australian bank accounts. The court found that the existence of these assets, and the potential for partnership accounts to be taken in Australia, made Australia an appropriate forum for those specific claims. The court also considered that the prior London arbitration did not preclude the Australian court from considering the partnership claims, as it had focused on case management rather than a determination of jurisdiction.
Consequently, the court granted leave to appeal, allowed the appeal, and set aside the permanent stay. It granted leave to serve the proceedings on the respondent in England concerning claims for relief related to the partnership assets. However, it ordered a permanent stay of proceedings in respect of other claims, effectively dismissing the respondent's motion to stay those proceedings. The court made no order as to the costs of the appeal or the primary proceedings, reflecting the mixed success of the parties.
Orders
Orders of the court
(1) Dismiss the appellant’s motion of 14 September 2021, with costs;
(2) Grant leave to appeal;
(3) Allow the appeal;
(4) Set aside the orders made in the Commercial List of the Equity Division on 8 March 2019 and in lieu thereof:
(a) Grant leave under Uniform Civil Procedure Rules 2005 (NSW), r 11.5, to the plaintiff to serve the proceedings on the defendant outside Australia and in England, insofar as it relates to the claims for relief in paragraphs 3 to 10 of the Further Amended Summons of 3 October 2018;
(b) Order that proceedings on the Further Amended Summons other than in respect of the claims referred to in (a) be permanently stayed;
(c) Otherwise dismiss Mr Emmott’s motion filed on 1 November 2018; and
(d) No order as to costs of the motion, to the intent that each party bear its own costs; and
(5) Save insofar as any interlocutory costs order otherwise provides, no order as to costs of the appeal, to the intent that each party bear its own costs.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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