Norsemeter Holdings AS v Boele (No 1)

[2002] NSWSC 370

CITATION:	Norsemeter Holding AS v Pieter Boele [No.1] [2002] NSWSC 370
FILE NUMBER(S):	SC 50173/01
HEARING DATE(S):	18/04/02
JUDGMENT DATE:	19 April 2002
PARTIES :	Norsemeter Holdings AS (Plaintiff) Pieter Boele (Defendant)
JUDGMENT OF:	Einstein J

COUNSEL :	Dr AS Bell, Mr JK Kirk (Plaintiff) Mr AW Street SC (Defendant)
SOLICITORS:	Corrs Chambers Westgarth (Plaintiff) Hogan Geikie Poole (Defendant)
CATCHWORDS:	Summary judgment - Enforcement of foreign judgment - Authority ad litem - Ostensible authority - Defendant initially gave authorisation to legal adviser to represent him in proceedings in a foreign Court - Defendant then purported to withdraw authorisation by communication to legal adviser who never communicated the withdrawal to the Court or other party - Legal adviser proceeded to represent the defendant through a contested appeal - Judgment entered against defendant - Whether the jurisdiction exercised by a foreign Court is of a kind which will be recognised for enforcement purposes under Australian rules of private international law - Whether defendant submitted to the jurisdiction of the foreign Court - Whether defendant denied natural justice - Whether judgment should not be enforced on grounds public policy
LEGISLATION CITED:	Foreign Judgments Act 1991 (Cth) Norwegian Civil Procedure Act 1915 Supreme Court Rules 1970 (NSW) Trade Practices Act 1974 (Cth)
CASES CITED:	Agar v Hyde (2000) 201 CLR 552 Brockley Cabinet Co Ltd v Pears (1972) 20 FLR 333 Commissioner of Police v Tanos (1958) 98 CLR 383 Copin v Adamson (1874) 9 LR Exch. 345 Dey v Victorian Railways Commissioners (1949) 78 CLR 62 Emanuel v Symon [1908] 1 KB 302 Esso China Inc v Chan Wing Mou [1999] VSC 294 Francis Travel Marketing Pty Ltd v Virgin Atlantic Airways Ltd (1996) 39 NSWLR 160 General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 Goddard v Gray (1870) 6 LRQB 139 Jacobson v Frachon (1927) 138 LT 386 Loucks v Standard Oil Co of New York (1918) 224 NY 99 Pemberton v Hughes (1899) CH.D 781 Re Dooney [1993] 2 QdR 362 Stern v National Australia Bank [1999] FCA 1421 Sultan of Jahore v Abubakar [1952] AC 318 The Bank of Australasia v Harding (1850) 19 LJCP 345 Vallee v Dumerge (1849) 154 ER 1221 Victorian Phillip Stephan Photo Litho Co v Davies (1890) 11 LR (NSW) 257
DECISION:	Plaintiff entitled to summary judgment.

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY dIVISION
commercial list

Einstein J

Friday 19 April 2002 ex tempore
Revised 10 May 2002

50173/01 Norsemeter Holding AS v Pieter Boele [No. 1]

JUDGMENT

The notice of motion

1 There is before the court a notice of motion filed on 23 November 2001 in which the plaintiff, Norsemeter Holding AS, seeks an order for summary judgment on the summons pursuant to Part 13 of the Supreme Court Rules.

2 The summons, filed on 23 November 2001, relevantly includes a claim for debt arising out of a judgment given on 22 June 2001 by the Borgarting Court of Appeal in Norway ["the Court of Appeal" or "the appellate tribunal"] against the defendant Mr Pieter Boele and others in respect of which the claim is that the defendant is jointly and severally liable.

3 The plaintiff relies upon five affidavits of his solicitor, Mr Sturzaker, made on 21 December 2001, 20 February 2002, 8 March 2002, 12 April 2002 and 17 April 2002, together with the several annexures and exhibits to these affidavits. The defendant relies upon one affidavit sworn by himself on 13 March 2002 and the annexures thereto.

The Principles

4 The motion for summary dismissal permits of an evidentiary base but is not available for the purpose of litigating factual matters which may fairly be open to be litigated. In General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 Barwick CJ at 130 referred to not only the significance of a case having to be very clear indeed to justify the summary intervention of the Court, there to prevent a plaintiff, here to prevent a defendant, submitting his case for determination by the Court [which principle is pervasive and is followed in this judgment - cf Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at 91 per Dixon J] but also to the inherent jurisdiction of the Court to stay actions which are frivolous and vexatious and an abuse of process, for which purpose the defendant had relied "on affidavits whereof the only material outcome is my knowledge of the existence and particulars of the authorities from the Commissioner to the other defendants to which I have already referred". And in Agar v Hyde (2000) 201 CLR 552 the Chief Justice at paragraph 9 referred to the material before the Court which consisted "of the pleadings and undisputed evidence explaining a number of matters referred to in the pleadings [there being] no reason to suppose that evidence might emerge at a trial which would alter that position".

5 Barwick CJ made plain, as I accept, that the exercise of the jurisdiction to summarily dismiss proceedings is not to be reserved for those cases where argument is unnecessary to evoke the futility of the plaintiff’s claim. As the Chief Justice pointed out:

"[a]rgument, perhaps even of an extensive kind, may be necessary to demonstrate that the case of the [plaintiff] is so clearly untenable that it cannot possibly succeed.” [at 130]

Questions of admissibility reserved for judgment

6 The Court reserved judgment on the admissibility of two documents. The first is referred to in exhibit DBS1 to the affidavit of Mr Sturzaker made on 21 December 2001 being the translation of the judgment of the Court of Appeal. That document is admitted into evidence on the motion.

7 The defendant further objected to the admissibility of paragraph 20 of the affidavit of Mr Sturzaker of 12 April 2002 and to annexure DBS 7 to that affidavit. The matter is dealt with below.

Overview

8 Standing back from all of the detail the central question for decision on the motion relates to the circumstance that the defendant initially gave instructions to legal counsel in Norway to act on his behalf and to represent him in relation to first instance proceedings brought by the plaintiff against him in the Oslo City Court ["the first instance Court" or "the Court of first instance"] where pleadings in the form of a defence and cross-claim were filed with his authority, but later, after the hearing at first instance and a matter of weeks before the judgment was delivered by the first instance Court, withdrew those instructions. The withdrawal of those instructions was not communicated by the defendant’s legal counsel in Norway, nor by the defendant, nor by any other person on his behalf to the Court or to the plaintiff or to the plaintiff’s legal counsel or to any other person on behalf of the plaintiff.

9 Following the decision of the Court of first instance which happened to be in favour of the defendant, their legal counsel proceeded to accept service of a notice of appeal filed by the plaintiff with the Court of Appeal and to file a cross-appeal on behalf of each of the defendants - still without communicating either to the Court of Appeal or to the plaintiff the fact of the withdrawal of the first defendant’s instructions and authority to act on his behalf.

10 Ultimately the Court of Appeal upheld the appeal and, reversing the decision at first instance, made the orders now sought to be enforced in these proceedings.

The primary issue

11 Although there are a plethora of issues which separate the parties at several levels, to my mind, the primary such issue concerns whether or not the Court of Appeal had ‘jurisdiction’ over the defendant in these unusual circumstances. The plaintiff asserts and the defendant denies that the Court of Appeal had such jurisdiction.

12 It is clear that it is a defence to the enforcement of a foreign judgment that the foreign court acted contrary to natural justice. That requirement relates to the procedure of the foreign court. As pointed out by Nygh in Conflict of Laws in Australia 7th ed at paragraph 9.39 traditionally this has been seen as imposing the requirements that each party must have had the opportunity of presenting his or her case before an impartial tribunal and must have been given due notice of the proceedings.

13 It is however also particularly important to further note that the jurisdiction with which the Court in which the enforcement is being sought is concerned "is the competence of the Court in an international sense - ie, its territorial competence over the subject matter and over the defendant. It's competence or jurisdiction in any other sense is not regarded as material by the Courts of this country": per Lindley MR in Pemberton v Hughes (1899) CH.D 781 at 791; cf Dicey and Morris, The Conflict of Laws 30 ins ed vol 1 page 516, rule 2. In short there is a clear distinction between the jurisdiction of tribunals from an international point of view and their jurisdiction from a purely municipal point of view.

14 Further, a judgment of a foreign court having jurisdiction over the parties and subject matter - ie having jurisdiction to summon the defendants before it and to decide such matters as it has decided - cannot be impeached in the country where it is sought to be enforced on its merits: Pemberton at 792 - 793. In the context of the alleged denial of natural justice in proceedings to enforce a foreign judgment, not only is it trite that such a judgment may not be impeached on the ground that it was erroneous on the merits “but it is also clear that a defendant may not seek to set up as a defence to an action on it, that the tribunal mistook either the facts or the law”: Goddard v Gray (1870) 6 LRQB 139 at 150. That is so even where the foreign judgment purports to apply the law of the forum in which enforcement is sought and the judgment manifests a clear error on its face in the application of that law. In Pemberton v Hughes (1899) 1 Ch. 781 at 790, Lindley MR said:

“If a judgment is pronounced by a foreign Court over persons within its jurisdiction and in a matter with which it is competent to deal, English courts never investigate the propriety of the proceedings in the foreign Court, unless they offend against English views of substantial justice. Where no substantial justice, according to English notions, is offended, all that English courts look to is the finality of the judgment. ..”

15 Hence as the plaintiff submitted, the legal question here is whether the jurisdiction exercised by the foreign court is of a kind which will be recognised for enforcement purposes under Australian rules of private international law. Submitting to the jurisdiction of the foreign court is sufficient for these purposes: Emanuel v Symon [1908] 1 KB 302 at 309 per Buckley LJ.

16 The proposition for which the plaintiff contends is that the initial or original submission by a party to a court of a foreign country, whether as plaintiff/counter-claimant or by voluntary conduct as by appearing and defending on the merits - binds that party to accept jurisdiction on appeal: Sultan of Jahore v Abubakar [1952] AC 318 at 341, a decision of the Privy Counsel, is said to be authority for this proposition. In that case the appellant who was the Sultan of Jahore, in proceedings instituted by him before a Japanese court during the occupation of Singapore by the Japanese, obtained from that court a judgment to the effect that he was the sole beneficial owner of certain land in Singapore. After the Japanese occupation had ended, the respondent, who was the appellant’s son, and others commenced proceedings seeking to set aside the Japanese decree, or alternatively, seeking liberty to appeal against it. The appellant thereupon sought to have the originating summons set aside and/or further proceedings under it stayed on the ground that he was an independent foreign sovereign over whom the court had no jurisdiction. The judgment of their Lordships was delivered by Viscount Simon who at page 341 put the matter as follows:

"As plaintiff, he obtained the decree declaring that he was the beneficial owner of the properties in question. If, therefore, the steps taken by the respondents with a view to reversing this decision are in the nature of an appeal from it to a court having jurisdiction to reverse the decision which the appellant has obtained, he could not object to being made respondent in these appeal proceedings, for his original submission to the original court binds him to accept the jurisdiction on appeal. If, on the other hand, the respondents application to the High Court of the Colony of Singapore to reverse the decree is a "new" proceeding, and not a continuation of the previous one, the appellants objection that he is a foreign sovereign would prevail, so far as the new proceeding impinged on his sovereign immunity".

17 The plaintiff’s short submission is that having submitted to the first instance proceedings, the defendant must be taken to have accepted that the judicial process of Norway would apply to resolve the dispute, including any available appellate processes. The proposition is that once a party is taken to have submitted to the jurisdiction, it is not material that the party has declined to continue to contest the proceedings at some point. The proposition is that the evidence discloses that the defendant was not only party to an agreement submitting to the jurisdiction of the court at first instance, but gave instructions to legal counsel in relation to appearing for him in those proceedings at first instance, defended those proceedings on their merits and filed a cross-claim on which he initially succeeded. Each of those steps is said to have involved the defendants submitting to the Norwegian judicial process being employed to resolve the dispute between him and the plaintiff. The reference to the defendant being party to an agreement submitting to the jurisdiction of the first instance proceedings is a reference to a clause in the Share Purchase Agreement entered into between the plaintiff and the defendants on 15 May 1998 which is the contract the subject of the adjudication by the Norwegian courts. Relevantly that contract in clause 12 entitled "Choice of Law and Legal Venue" was in the following terms:

" This Contract is governed by Norwegian law. The parties agree to Oslo byrett (Oslo City Court) as the legal venue".

18 Mr Street submitted that the clause "is not a clause that picks up disputes relating to the agreement". He further submitted that the words "as the legal venue" fell outside the commonly found formal words, for example including a submission to the jurisdiction of the courts of a particular country or in this country, of a particular State. The submission is that a narrow construction should be given to this clause in terms of the causes of action adjudicated upon by the Norwegian courts.

19 In my view the clause clearly relates to disputes concerning the contract and arising in respect of the contract and relating to the rights of the parties in respect of their dealings in relation to the contract. There is no basis for the contention that the Courts in Norway did not have 'jurisdiction' in an international sense in respect of the matters litigated before them. As Gleeson CJ put the matter in the Francis Travel Marketing Pty Ltd v Virgin Atlantic Airways Ltd (1996) 39 NSWLR 160 at 165, parties to a commercial contract:

"are unlikely to have intended that different disputes should be resolved before different tribunals, or that the appropriate tribunal should be determined by fine shades of difference in the legal character of individual issues, or by the ingenuity of lawyers in developing points of argument".

20 The plaintiff’s written submissions include the following:

"This judicial process inevitably involved a number of aspects and stages. A party cannot pick and choose which aspects it submits to (leaving aside the exceptional case where the party appears only for the purpose of disputing jurisdiction). In particular, it would undermine the due administration of justice if a party were permitted to accept the jurisdiction of a court up to the point that it receives some favourable determination and then disavow further acceptance.

Subject to any argument based upon a denial of natural justice…it is not to the point that Mr Boele withdrew instructions from those who had represented him at first instance for the purposes of the appeals ( a fact which must be accepted for the purposes of this summary application ). It is no answer, for example, for a party that has agreed in a jurisdiction clause to submit to the courts of a particular forum to complain when an attempt is made to enforce default judgment that he or she did not participate in the hearing of the foreign proceedings, let alone was not represented in those proceedings." [emphasis added]

21 The plaintiff further submitted as follows:

" Submission may take the form of an express agreement to submit to the courts of a particular jurisdiction. A party may be taken to have submitted by express contractual provision, even if the method of service contemplated in the contract is in fact unlikely to bring the matter to the party’s attention: Copin v Adamson (1875) LR 1 Ex D 17. In Feyerick v Hubbard [1902] 71 LJKB 509, it was held that, where a party by contract agrees to submit certain disputes to the courts of another country, he is bound by that judgment even if he chooses not to make any appearance or advance any defence. A default judgment in these circumstances is enforceable. See also Jeannot v Fuerst (1909) 25 TLR 424 where it was held that there was no denial of natural justice in circumstances where the defendants were not aware of the fact that proceedings had been commenced against them and did not have the form of notice that was necessary in English courts.

Submission may also be spelt out of a defendant’s entry of an appearance (Victorian Phillip Stephan Photo Litho Co v Davies (1890) 11 LR (NSW) 257) and/or the filing of a defence and/or contesting the proceedings on the merits. Submission may also be spelt out of the filing of a cross-claim (National Commercial Bank v Wimbourne (1987) 11 NSWLR 156 at 174F per Holland J; Marlborough Harbour Board v Charter Travel Co Ltd (1989) 18 NSWLR 223 at 232G per Hope JA; Emanuel v Symon at 309)"

The defendant’s submissions

22 The defendant’s submissions ranged across a large number of areas so that the convenient course is to refer only, at least in the first instance, to what I regard as the central tenet underpinning those submissions.

23 The fundamental proposition for which the defendant contended is that he neither knew of the appeal proceedings, nor authorised anyone to represent him in those proceedings, nor appeared in those proceedings, either personally or by any authorised representative. Hence it was put that he had not submitted to the jurisdiction of the Court of Appeal and further that on the very same bases, he was denied natural justice, this being an accepted ground of defence to the enforcement of a foreign judgment. The defendant further sought to invoke the contention that the judgment of the Court of Appeal should not be enforced on grounds of public policy.

24 A convenient approach to the respective submissions in this regard is to commence by setting out the portion of the plaintiff’s written submissions going to the natural justice issue:

"In the classic formulation of this defence to the enforcement of foreign judgments Atkin LJ stated there are two core considerations relating to natural justice – first that the court “has given notice to the litigant that they are about to proceed to determine the rights between him and the other litigant”, and secondly that the court does then “afford him an opportunity of substantially presenting his case”: Jacobson v Frachon (1927) 138 LT 386 at 392 (CA).

The first consideration is really a corollary of the second, for the essential requirement of natural justice is that “before anyone can be punished or prejudiced in his person or property by any judicial or quasi-judicial proceeding he must be afforded an adequate opportunity of being heard”: Commissioner of Police v Tanos (1958) 98 CLR 383 at 395 per Dixon CJ & Webb J.

It is not, however, “contrary to natural justice that a man who has agreed to receive a particular mode of notification of legal proceedings should be bound by a judgment in which that particular mode of notification has been followed, even though he may not have had actual notice of them”: Vallee v Dumerge (1849) 154 ER 1221 at 1227; followed in Copin v Adamson (1874) 9 LR Exch. 345 at 352-3, 356; upheld on appeal 45 LJ Ex. 15; see also The Bank of Australasia v Harding (1850) 19 LJCP 345 at 357." [emphasis added]

25 Vallee v Dumergue was a decision by the Court of Exchequer, the judgment delivered by Baron Alderson. The proceedings concerned the defendant who although resident in England, had become a shareholder in a French company in circumstances in which the pleading was that according to the law of France, it was necessary for the defendant to effect a domicile at which domicile all instruments and proceedings relating to the company or to the defendant as shareholder in it might be served. The replication stated that by the law of France, the domicile contained in an instrument and declaration in writing became the elected domicile of the party and that all proceedings might by that law, be regularly served at such elected domicile on the party. The proceedings had been in due course served at the place of the defendant’s elected domicile which was said to be in all respects regular according to the law of France. The plaintiffs sought to recover in the proceedings in the Court of Exchequer, the amount he had recovered before the Court of Civil Tribunals First Instance sitting at Palace of Justice at Paris. The judgment of Baron Alderson at 1227 includes the following:

"The defendant states, he was not served with any process, which clearly means not actually served, and then adds, nor had he any notice whatever of the said proceedings; adding afterwards, that he had not any knowledge or notice whatsoever of them. All these averments point to actual notice alone. Now, if this be so, the replication is not an argumentative denial of this notice, but consists of a statement of facts which show, that, by the agreement to which the defendant has become a party, no such notice need be given to him , and that the plea, which is in substance that the circumstances under which the judgment was obtained were contrary to natural justice, cannot be supported; for that it is not contrary to natural justice that a man who has agreed to receive a particular mode of notification of legal proceedings should be bound by a judgment in which that particular mode of notification has been followed, even though he may not have had actual notice of them …we, therefore, think the replication sufficient..”

26 Dr Bell cited a number of authorities in support of the proposition that once defendants have had due notice of proceedings and especially if they have participated, they cannot simply ignore the proceedings but must make reasonable efforts to pursue and protect their rights including any rights on appeal. It seems to me that the submission is one of substance. I turn to the authorities cited:

· In Brockley Cabinet Co Ltd v Pears (1972) 20 FLR 333, the judgment debtor had entered an appearance in the foreign proceedings, had filed a defence and a cross-claim, then had left the country (England) and simply taken no further part in the proceedings. It was held by Fox J that the statutory defence (under the previous State and Territory legislation, and what is now Commonwealth Foreign Judgments Act (section 7(2)(v)), that the judgment debtor “did not receive notice of those proceedings in sufficient time to enable him to defend the proceedings and did not appear”) was not available despite the fact that the debtor had had no actual knowledge of the progress of the matter:

“Absence of actual knowledge of later interlocutory applications is, so far as concerns the present ground, immaterial. The defendant’s position in relation to those steps is regarded as being sufficiently protected by the procedures of the court in which he is sued. The reality of the present position seems to be that the defendant gave an address for service in England, and then left England without changing it.” (at 337)

· Similarly, in Re Dooney [1993] 2 QdR 362 the judgment debtor had instructed lawyers in New Zealand to act for him, and those lawyers appeared on his behalf. However, the debtor lost his office space and his lawyers had no other means of contacting him. Summary judgment was entered against him and sought to be enforced in Queensland. Ryan J held that he had received notice in sufficient time to enable him to defend the proceedings: “If he has failed to keep in contact with his solicitors knowing that proceedings were being instituted, or to enable them to contact him, he cannot be heard to say that the judgment must be set aside under s7(1)(c)” (at 366).

· In Esso China Inc v Chan Wing Mou [1999] VSC 294 the first defendant had been served through the letterbox of an apartment he maintained in Hong Kong. He did not participate in the proceedings. There was evidence that he had been in Hong Kong around the time of service, and further that it had been his practice to list that address on documents. Given this, Balmford J stated that it “might well have been thought, therefore, that he would take some steps to see that mail sent to the apartment was redirected, or would attend there himself during his frequent visits to Hong Kong” (at [20]). In all the circumstances it was held that he could not rely on the notice defence in the Foreign Judgments Act 1991 (Cth).

27 Clearly none of these authorities dealt with a circumstance in which the defendant had initially given authorisation to a legal adviser to represent him or her in proceedings in a foreign Court (pursuant to which authorisation the legal adviser had taken active steps over a considerable period in contesting that litigation and in pursuing cross-claims in that litigation at first instance) and had then determined to and had in fact withdrawn that authorisation by communication to the legal adviser who never communicated the withdrawal to the court or to the other party and proceeded to represent the defendant through a contested appeal and through a leave application to the court standing at the apex of the judicial hierarchy in the foreign country.

The Facts

28 Sufficient of the issues have now been revealed to permit the court to return in more detail to the facts in relation to which the application for summary judgment requires to be adjudicated.

29 Albeit bearing in mind the high issue which separates the parties in relation to whether and if so to what extent and when the defendants legal counsel had authority to take steps in relation to the Norwegian proceedings, it is convenient to set out the overview chronology prepared by the plaintiffs for the purposes of the motion:

NORSEMETER Holdings as v boele

CHRONOLOGY

DATE	EVENT	REFERENCE
15 May 1998	The Defendant holds shares in a company Airport Surface Friction Tester AB (“ASFT”) which he authorises Mr Lief Graflind to sell to Norsemeter Holdings (‘the Agreement”)	Annexure C to Boele 13/3/02
15 May 1998	Clause 12 of the Agreement, under the heading “Choice of Law and Legal Venue” provides that “this contract is governed by Norwegian law. The parties agree to Oslo byrett (Oslo City Court) as the legal venue.”	DBS1 to Sturzaker 21/12/2001
23 December 1998	The Plaintiff commences proceedings against the Sellers in the Oslo City Court (“Oslo City Court Proceedings”):	Sturzaker 21/12/01 para 6(k); Borgarting Court of Appeal Judgment p11
25 February 1999	The Defendant receives a letter from Mr Graflind’s lawyers, containing a certificate and Power of Attorney to sign. The Defendant signs these documents and, in respect of those documents, says “I trusted that they were something that was required to be done by Graflind on advice from his lawyers in respect to the proceedings in the Oslo City Court”:	Boele paragraph 19.
Boele further states that “in regard to the Power of Attorney, however, I was aware that I was authorizing Vinge Law Firm to represent me in the Oslo City Court in my capacity as a shareholder in Graflind’s company.”	Boele paragraph 20
30 March 1999	A Defence to the proceedings and Pleading in the Motion for an interlocutory injunction is filed on behalf of, inter alia, Mr Boele:	DBS1 to Sturzaker, 12/4/02.
30 April 1999	The defendants to the Oslo City Court Proceedings, including Mr Boele, file a Cross-Claim in those proceedings claiming that the Plaintiff should pay compensation on the grounds of breach of contract.	DBS2 to Sturzaker, 12/4/02
4 May 1999 - 7 May 1999	An oral hearing is conducted at Oslo City Court (and was then adjourned until 5 October 1999). At the hearing, the Court Records record that Mr Boele is represented by Mr Holm and Mr Azelius.	DBS3 to Sturzaker, 12/4/02.
5 - 7 October 1999	A further hearing was is conducted. At this time, the Court Records record that the Defendants, including Mr Boele, are represented by Mr Holm.	DBS3 to Sturzaker, 12/4/02.
29 January 2000	Mr Boele purports to cancel any and all his Powers of Attorney, directly and indirectly, to companies/individuals in relation to ASFT “and the Norsemeter case” “with any action to be taken [to be] assessed on a case by case basis”.	Boele, para 25 and Annexure J.
21 February 2000	Judgment delivered by the Oslo City Court (“the Oslo City Court judgment”). This judgment is in favour of the Defendants, including Mr Boele, in the main suit and judgment is entered for Plaintiff in the counter-claim. In the counter claim, the Defendants are ordered to pay costs in the amount of NOK40,000.	Sturzaker, 20/2/02, Annexure A – page 11 of Borgarting Court of Appeal Judgment. Borgarting Court of Appeal Judgment, p 12
24 February 2000	The Plaintiff files a notice of appeal against the Oslo City Court Judgment in the Borgarting Court of Appeal.	Borgarting Court of Appeal Judgment, p12
27 March 2000	Mr Gerard Holm lodges a cross-appeal on behalf of the Defendants, including (purportedly) Mr Boele, in the Borgarting Court of Appeal.	Borgarting Court of Appeal Judgment, p12
24 April 2001 - 4 May 2001	Hearing of the appeal and cross-appeal takes place in the Borgarting Court of Appeal with Attorney-at-law Gerhard Holm being recorded in the judgment as appearing for Messrs Graflind and Boele: Borgarting	Court of Appeal Judgment, p13
26 June 2001	The Borgarting Court of Appeal of Norway delivers its judgment (“the Judgment”), holding the defendants, including Mr Boele, jointly and severally liable to the Plaintiff in the sum of SEK 7 million, dismissing the counter-suit and awarding the Plaintiff full costs both for the Oslo City Court proceedings and the Appeal Court proceedings totalling an amount of NOK1,842,687. It is recorded in the judgment that “Lief Graflind was authorised to attend [the appeal] on behalf of … Pieter Boele, and they were also represented by their counsel.”	Court of Appeal Judgment Court of Appeal Judgment, p12
30 July 2001	The defendants including, purportedly, Mr Boele, lodge an appeal to the Norwegian Supreme Court.	Sturzaker, 20/2/02, Annexures B and C
21 November 2001	The Appeals Committee of the Norwegian Supreme Court notifies the parties that leave to appeal is denied. The Appeals Committee awards the Plaintiff the sum of NOK6000 in costs in respect of the Supreme Court Appeal.	Sturzaker, 20/2/02, Annexures B and C
22 November 2001 - present	The Plaintiff makes efforts to enforce the Judgment against the other parties to the Agreement, being Eva Ulrika Graflind and Fredrik Graflind, in other jurisdictions but there has been no effective recovery of the sum owing to the Plaintiff under the Judgment in respect of any of the other parties to the Agreement against whom the Judgment lies.	Sturzaker, 12/4/02 paras 12 – 19

General authority ad litem

30 During the course of the hearing of the motion a letter from one of the judges of the Court of Appeal was admitted into evidence. This letter is in the following terms:

"I refer to your letter of 5 March 2002.

Section 47 of the Norwegian Civil Procedure Act 13 August 1915 states that:
Pursuant to a general authority ad litem for the case, the representative ad litem may:

1. bring and accept actions and cross-actions, adopt intervention suits, approve and waive submissions and take all other steps in legal proceedings relating to the conduct of the case before the relevant instance;

2. give notice of appeals against interlocutory orders and decisions;

3. accept any litigation costs awarded to his client.
An advocate is deemed to have the authority he asserts to take all procedural steps for the furthering of the case, in order to have enforced a decision by the court and to receive what his client is entitled to.
Pursuant to the general authority ad litem vested in a representative ad litem according to section 47 of the Civil Procedure Act, the representative is considered as authorised to act on behalf of his client, and to make such legal dispositions as are stated in the regulation. The representative ad litem is deemed to have such authority unless it is clearly stated that his authority is limited. This implies that the court cannot require that the representative ad litem present a power of attorney that shows that he can act on behalf of his client in the case. It also lies within the authority ad litem to receive services and notices, as for example summons to court hearings. Summons to court hearings are sent by the court to the representative ad litem, and it is the responsibility of the representative to inform his client of the time for the court hearing. The court does not check whether the representative has summoned his client. In the current case, Advocate Gerhard Holm acted as the representative ad litem for Pieter Boele, Eva Ulrike Graflind and Fredrik Graflind. Advocate Gerhard Holm is considered to have had a general authority ad litem, of section 47 of the Civil Procedure Act. Accordingly, the court has related to Mr Holm as the representative ad litem for, among others, Pieter Boele, in the case. Whether Mr Holm was in actual fact entitled to act on behalf of Mr Boele is unknown to the Court of Appeals.”
[Letter of 18 March 2002 exhibit P. 1]

31 Also sought to be admitted into evidence is a translation into English of section 49 of The Norwegian Act, 1915-08-013 No 6 relating to Court Procedure for Civil Litigation (The Civil ProcedureAct). This is to be found in Part One "General provisions" and as part of Chapter 4 is entitled

“Chapter 4. Representative ad litem ie Counsel.
An authority ad litem, ie a brief to Counsel, may be revoked at any time. Nevertheless, as regards the court and the opposing party, a revocation can only take effect when it has been announced to them…"

32 A ruling on admissibility was reserved. Dr Bell, in the event that the document may not be admitted into evidence, applied for leave to correct the formal position by subsequent evidence which would include production of all or some of the relevant statute including the translation.

33 In my view the evidence clearly establishes that the defendant had appointed both Advocate Holm as well as Advocate Azelius by general authority ad litem as his representatives ad litem. They were both recorded as "counsel" in the defence files on 30 March 1999 in the first instance proceedings which specifically included the words "this pleading is a defence for [the defendant] in the main action". Further the pleading includes the following:

"As far as Pieter Boele is, he has not acknowledged service of documents [the context suggesting that the form of court documents by way of the writ and motion appear to be being referred to] the document sent to him written in the Norwegian, and because he does not understand what is written in the document, he has asked that the document be translated into English. In spite of this, Pieter Boele has decided, after receipt of the most recent letter from the Court, to acknowledge service and file this defence.

The defending parties have decided that both the law firm Vinge KB and firm Thommessen Krefting Greve Lund AS are to represent the parties, in the case concerning an interlocutory injunction as well as in the main action."

34 Also to be taken into account is Annexure "H" to the defendant's affidavit being the form of Power of Attorney of 9 March 1999 a copy of which is annexed to this judgment as Annexure “A” having been admitted also as exhibit D 1.

35 However, none of this suggests that following the withdrawal of instructions these advocates continued to have actual authority to represent the defendant. The plaintiff’s case on the summary motion accepts that actual authority was relevantly withdrawn but relies upon the continuance of the ostensible authority in these advocates to represent the defendant. In short it matters not whether or not as a matter of construction of the Power of Attorney which became exhibit D1 (which would be a matter of foreign law), the defendant’s legal advisers had actual authority to accept service of the Notice of Appeal - see the use of the word "writs" and compare the authority to accept service of notices. The point is that the ostensible authority extended to treating with the proceedings in the Court of Appeal being a continuation of the first instance proceedings. There is no evidence of any communication by the defendant or his Norwegian lawyers clothed with their relevant instrument of authority to the plaintiff or its legal advisers of any such document or of material relating to the actual authority conferred by the defendant upon his Norwegian legal advisers. Nor is there any evidence as to any requirements to be found in the procedures of the Norwegian courts for the communication of this type of material. Of course one does have at least one material communication already referred to, namely the terms of the 30 March 1999 defence at first instance.

36 To my mind each of the matters set out in the following written submission of the plaintiff is made out by the uncontroversial evidence placed before the Court on the hearing of the motion:

Here the defendant received notice that the proceedings had been instituted in the Oslo City Court, was afforded the opportunity to participate, and did participate in those proceedings. He participated by authorising lawyers to act on his behalf in the matter, who then did so act. He was content to take advantage of the ruling in his favour by the Oslo City Court, only purporting to cancel his lawyers’ authority after that Court’s ruling. That purported cancellation of authority was not communicated to anyone other than Messrs Graflind and Holm. It was plainly not communicated to the Court of Appeal or to the plaintiff. Mr Boele’s former lawyers plainly had notice of the appeal proceedings and purported to represent his interests on appeal. To my mind, subject only to the formalisation of the proof of the terms of the Norwegian Civil Procedure Act Chp.4, there was no effective revocation under that section.

37 In that regard it seems to me appropriate that the plaintiff be granted the leave which it seeks to formally prove the terms of the section. Whilst I have considerable doubt as to whether or not this is a matter which may be said to be bona fide in dispute, and have had in mind the possibility of dispensing with the rules of evidence for proving the section, on reflection it seems appropriate to permit the plaintiff the leave to which I have referred. It is perhaps appropriate to add that I do not see the precise terms of the section as determinative of the issue raised on the motion.

Continuation of first instance proceedings

38 A further issue which was litigated on the hearing of the motion was whether on the evidence the Court could be certain that the Court of Appeal was just that rather than being a court hearing a new and separate set of proceedings which could not properly be described as a continuation of the first instance proceedings. In my view this matter has been soundly and clearly established by the plaintiff. One need only in this regard refer to the Court of Appeal decision which records the parties as "appellant" and "respondent", states that the appellant "has within the time stated appealed against the City Court's judgment", refers to "observations of the Court of Appeal" and refers to "Norsemeters Notice of Appeal of 24 February 2000" and ends by including in its orders, orders in relation to the costs of first instance proceedings. Further, at the end of the judgment at the first instance, one finds the following:

"This ruling shall be served on Counsell. The ruling may be appealed to Bogarting High Court. The appeal deadline is 2 (two) weeks from the service of this ruling." [emphasis added]

39 It seems that a primary and pivotal issue which is raised by the motion concerns the circumstance in relation to which there can be no doubt on the facts clearly proven on the motion, that the defendants counsel at all material times had ostensible authority to receive the notice of appeal and appear in the appeal on behalf of the defendant. On the evidence this is a necessary consequence of having appeared on the defendant’s behalf and within his authorisation in the proceedings at first instance. Further, as the plaintiff submitted:

"To the extent that Mr Boele did not know of the appeal proceedings, that was as a result of his failure to notify the plaintiff and the Court of his withdrawal of instructions to his lawyers and/or their failure to notify the Plaintiff. It may or may not be a matter in respect of which Mr Boele has cause for complaint against his former lawyers and/or Mr Graflind. As the following cases show, however, where a party sets up a form or mode of communication for the purposes of court proceedings, he cannot be heard to say, in circumstances where that mode of communication is followed, that there has been a denial of natural justice because he did not in fact know of proceedings."

40 The primary and pivotal issue concerns two inconsistent principles. The first is the fundamental principle of natural justice which under the system of common law requires a defendant to be given notice of the foreign proceedings and an opportunity to attend to be heard in relation to those proceedings. The second concerns the concept earlier referred to as "jurisdiction in the international sense". A party who has taken regular steps to authorise foreign lawyers to represent him in proceedings in which the jurisdiction of a foreign Court has been exercised has submitted to regulation in and in relation to such proceedings by the procedures of the foreign Court. That litigation will concern parties on the other side of the record who have every entitlement to rely upon regular compliance with those same procedures and who are doubtless bound by precisely the same obligations. Whilst aberrant behaviour by a legal adviser placed upon the record in a foreign Court to represent a party, such as failing to communicate to the Court or to the other party the fact that his or retainer has been withdrawn, one would think would be likely to have significant legal consequences and/or disciplinary consequences at the hand of the client, it is difficult to see why the other party ought be adversely affected by conduct which in no way shape or form can be sheeted home to such party. [cf Conflict of Laws in Australia 7th ed, PE Nygh and M Davies at paragraph 9.41 dealing with a denial of natural justice where the foreign Court was prevailed upon to dispense with notice of the proceedings to the defendant by the fraud of the plaintiff].

41 To my mind there is clear substance in the submission of the plaintiff’s counsel to the effect that in this state of conflict of principle it is necessary for the Court to defer to the need to protect the regular adherence to the practices and procedures of courts of law so as to avoid an injustice to a party which observed those practices and procedures. Regrettably this must be at the expense of relevant prejudice to a party who fails to observe those practices and procedures albeit without personal fault. This may occur simply because that party [having initially authorised legal advisers to represent himself or herself by taking steps and serving and receiving documents in relation to the proceedings, and subsequently having withdrawn that authorisation], experiences the misfortune of finding that the legal advisers have failed to properly communicate the fact of such withdrawal to the Court or to the opposing party.

42 It is to be noted also that quite clearly on his own evidence the defendant prior to signing the 9 March 1999 power of attorney was aware that there were proceedings in the Oslo City Court and that he was authorising Vinge Law Firm to represent him in that Court in his capacity as a shareholder in Airport Surface Friction Tester AB.

Public Policy

43 Insofar as the defendant’s submissions sought to rely on the assertion that the Norwegian judgment should not be enforced on grounds of public policy the following submissions of the plaintiff are to my mind of substance:

"Whilst a denial of natural justice is an accepted ground of defence to the enforcement of a foreign judgment, it adds nothing to the Defendant’s case on natural justice to invoke public policy. Similarly, considerations of jurisdiction are dealt with by established principles of general law, and to put similar arguments on the basis of public policy adds nothing.”

44 In Stern v National Australia Bank [1999] FCA 1421 at pars 138 ff (affirmed (2000) 171 ALR 192), Tamberlin J. dealt with an argument that a Californian judgment should not be enforced on grounds of public policy on the basis that the defendants had a defence under the Trade Practices Act which they had not been able to run in the Californian proceedings. Tamberlin J. rejected this argument and made the following observations about the nature of a defence to enforcement of a foreign judgment on grounds of public policy:

“As the editors of Dicey and Morris on The Conflict of Laws, 12th ed. 1993, point out at 511 -512, there are very few reported cases in which foreign judgments in personam have been denied enforcement or recognition for reasons of public policy. One example given by the authors is the Irish case of Mayo-Perrott v Mayo-Perrott [1958] IR 336 where the Supreme Court of the Republic of Ireland refused to enforce an English order for costs in favour of a wife against her husband which was ancillary to an English divorce decree. One of the reasons given was that the cause of action could not have supported an action in the Irish Republic where divorce is not allowed, and enforcement of an order ancillary to a divorce decree was contrary to Irish public policy.
Professor Nygh in his work Conflict of Laws in Australia 6th ed. 1995, at 157 says:
A foreign judgment may be contrary to public policy because it is founded on a law which is not acceptable to the public policy of the forum, such as a judgment for the wages of a prostitute or an order for maintenance of a child not confined to minority or other specified period ....
A foreign judgment may also be contrary to public policy because it was obtained in a manner obnoxious to the law of forum such as duress, or undue influence ... Foreign judgments affecting personal status eg divorces, annulments and adoptions have also been denied recognition under the discretionary power to refuse recognition if such orders have been obtained in circumstances abroad, or have an effect on a party in the forum which is `contrary to substantial justice.
The public policy which can be availed of as a defence to enforcement of a foreign judgment is narrower and more limited in private international law than in municipal law. It is pointed out in Cheshire and North's Private International Law, 12th ed. 1992, at 129:
A transaction that is valid by its foreign governing law should not be nullified on this ground unless its enforcement would offend some moral, social or economic principle so sacrosanct in English eyes as to require its maintenance at all costs and without exception.
The learned authors refer to the judgment of Cardozo J in Loucks v Standard Oil Co of New York (1918) 224 NY 99 at 111 where his Honour said:
...a right of action is property. If a foreign statute gives a right the mere fact we do not give a like right is no reason for refusing to help Bank in getting what belongs to him. We are not so provincial as to say that every solution of a problem is wrong because we deal with it otherwise at home ... The courts are not free to refuse to enforce a foreign right at the pleasure of the judges, to suit the individual notion of expediency or fairness. They do not close their doors unless help would violate some fundamental principle of justice, some prevalent conception of good morals, some deep rooted tradition of the common weal .
…

The thread running through the authorities is that the extent to which the enforcement of the foreign judgment is contrary to public policy must be of a high order to establish a defence. A number of the cases involve questions of moral and ethical policy; fairness of procedure, and illegality, of a fundamental nature.

In the present case it seems to me that the enforcement of the Californian deficiency judgment in Australia is not against fundamental Australian public policy in the sense used in the above authorities, even if such a claim or defence was not available in the Californian proceedings as that provided in s 52 of the Trade Practices Act.”
(Emphasis added)

Ultimate Holding

45 Notwithstanding the jurisprudential and analytical complexities involved in disentangling and identifying of the appropriate principles, to my mind the plaintiff, subject only to the formulisation of the proof of section 49 earlier referred to, has made good the proposition that it is entitled to summary judgment. Reference was made earlier in this judgment to the fact that argument even of an extensive kind may be necessary to demonstrate that the case of a party, here the defendant, is so clearly untenable that it cannot possibly succeed. In my view this case, after close examination, is indeed sufficiently clear to justify the summary intervention of the Court there being on examination no material facts which could be said to be in issue in the sense that they are required to be litigated in order for the Court to be in a position to determine whether or not the foreign judgment is binding upon the defendant. In my view none of the grounds advanced by the defendant provide him with any good defence or constitute a sufficient answer to the plaintiffs claim. Taking the facts as alleged by the defendant at their highest none of the suggested defences are a substance or have in my view any prospect of success on a final hearing. The Court of appeal had jurisdiction to determine the proceedings in the fashion which it did and the submission that the defendant did not receive proper notice of the proceedings and/or that in the circumstances the judgment would be contrary to public policy are rejected.

46 The plaintiff will be given an opportunity to attend to the adducing of further evidence in relation to section 49 and both parties will then be heard on that issue. The defendant may respond by adducing his own evidence only on that matter. Any further submissions relating to that matter, and to the effect of that evidence upon this judgment, will then be taken and no doubt short minutes of order will then be in order.

47 It only remains for the Court to stand the proceedings over for such period as may be necessary for the plaintiff to adduce, having served it upon the defendant, evidence of the type Dr Bell sought leave to adduce relating to s 49, and for the defendant then to be given an opportunity to consider that matter and if it is disposed to do so to adduce like evidence and for submissions to be taken from both parties.

48 The proceedings will be stood over to 24 April 2002 at 9.30am for the purpose of mentioning the matter and then hearing from the plaintiff as to whether it has been able to obtain the further evidence it seeks to obtain and to serve it on the defendant, and for the purpose of inquiring of the defendant as to what he seeks to do in the circumstances. If the defendant having been served with that material seeks to go into evidence on that topic, that will certainly be permitted and the matter will then be before the Court for any submissions going to that outstanding issue. Subject to that, short minutes of order will then be taken.

I certify that paragraphs 1 – 48
are a true copy of the reasons
for judgment herein of the
Hon. Justice Einstein
given on 19 April 2002 ex tempore
and revised on 10 May 2002

___________________
Susan Piggott
Associate

10 May 2002

Last Modified: 06/21/2002