Oceanic Sun Line Special Shipping Co inc v Fay

[1988] HCA 32

HIGH COURT OF AUSTRALIA

Wilson, Brennan, Deane, Toohey and Gaudron JJ.

OCEANIC SUN LINE SPECIAL SHIPPING COMPANY INC. v. FAY

(1988) 165 CLR 197

30 June 1988

Practice

Practice—Action—Stay—Cause of action arising out of jurisdiction—Greek island cruise booked in New South Wales—Ticket not given to passenger until commencement of cruise in Greece—Foreign jurisdiction clause on ticket—Whether term of contract—Action brought in New South Wales for injury sustained by passenger on cruise—Application by defendant for stay—Principles—Forum non conveniens.

Decisions

WILSON AND TOOHEY JJ: This is an appeal against a decision that the respondent's action against the appellant in the Supreme Court of New South Wales not be stayed. The decision is interlocutory in character. It is an unfortunate example of a case where, as Lord Templeman said in Spiliada Maritime Corp. v. Cansulex Ltd. (1987) 1 AC 460, at p 464, the parties "have chosen to litigate in order to determine where they shall litigate". It involves findings that are necessarily provisional because all the evidence has not yet been heard. It does not answer the questions of substance between the parties. On the other hand, the issues raised by the appeal are important for this is the first occasion on which this Court has been asked to decide whether it will follow recent decisions of the House of Lords in relation to the doctrine of forum non conveniens.

2. In June 1983 the respondent was a passenger on a Greek ship, the M.S. Stella Oceanis, during a cruise of the Aegean Sea. He received serious injuries while taking part in trap shooting on board the ship. At that time the ship was sailing in Greek waters. The respondent is and was, at all material times, a resident of Queensland. The appellant is a company incorporated in Greece. Together with another company, it conducts Mediterranean cruises on its ships under the name "Sun Line Cruises".

3. On 10 September 1985 the respondent began proceedings against the appellant in the Supreme Court of New South Wales, claiming damages for negligence. He obtained leave to serve his statement of claim upon the appellant at its principal place of business in Athens. Leave was granted pursuant to Pt.10, r.2(2) of the Supreme Court Rules (N.S.W.), the basis being Pt.10, r.1(e) as it then stood- "where the proceedings are founded on, or are for the recovery of, damage suffered wholly or partly in the State caused by a tortious act or omission wherever occurring". Service was effected on the appellant which entered a conditional appearance.

4. By notice of motion the appellant sought to have the statement of claim set aside or struck out for lack of jurisdiction in the Supreme Court of New South Wales, alternatively that service of the statement of claim be set aside and, as a further option, that the proceedings be stayed. The appellant made a submission that Pt.10, r.1(e) was invalid as being outside the legislative competence of the parliament of the State of New South Wales. Having regard to the decision of the Court of Appeal in Flaherty v. Girgis (1985) 4 NSWLR 248 (appealed from to this Court, but on another ground: see (1987) 162 CLR 574), the submission was formal only and it was rejected. Effectively the only question before Yeldham J., the primary judge, was whether the action brought by the appellant against the respondent should be stayed. His Honour declined to order a stay and, on appeal, his decision was upheld. The appeal to this Court does not raise any question of the validity of the rule.

5. Underlying the submissions of counsel was a question as to when and where a contract of carriage was made between the parties and the terms thereof. Yeldham J. and the majority in the Court of Appeal (Glass and McHugh JJ.A.; contra Kirby P.) held that such a contract was made in Sydney. Yeldham J. concluded that it was made when the appellant's agent received the balance of money due to it and issued an exchange order entitling the respondent to obtain a ticket from the appellant in Greece, before boarding the ship. The majority in the Court of Appeal thought that a contract may have come into existence at an earlier time but in any event no later than the issue of the exchange order. We agree with Yeldham J.'s conclusion in this regard which in any event was a view shared by the Court of Appeal; our reasons require consideration of the circumstances surrounding the respondent's participation in the tour and analysis of the documentation issued by the appellant.

6. In 1983 the respondent and his wife made arrangements to travel to Europe. The arrangements were made by the respondent's mother-in-law, Mary Rossi, who was the proprietor of a Sydney travel agency known as Mary Rossi Travel. Mary Rossi Travel was organizing a luxury tour of Europe and the respondent and his wife decided to join the tour, but only for that section involving a cruise of the Greek islands on the Stella Oceanis. The respondent's wife went to Sydney from time to time to make the travel arrangements. She brought back a brochure containing information about "Sun Line 1983 Summer Cruises" to the Greek islands and she showed the respondent the cabin which had been booked for them. The respondent read the brochure only casually and in particular did not read any of the material printed inside the back cover under the heading "Things To Know Before You Go". On 30 March 1983 a deposit was paid to Mary Rossi Travel and in turn to J.M.A. Tours which was the general sales agent for Sun Line Cruises. On 7 April J.M.A. Tours raised an invoice against Mary Rossi Travel for the cost of the respondent and his wife's cruise on the Stella Oceanis. The invoice identified their cabin as A24. On or about 27 April 1983 the respondent and his wife went to Sydney where they paid Mary Rossi Travel the balance due for their overseas trip, including the Greek islands section of the tour. On the day following they flew to London and on 28 May they met up with Mrs. Rossi and members of the tour group in Athens. Before the respondent left Australia, he received an exchange order for the Stella Oceanis cruise portion of the tour. He received this document in exchange for payment to J.M.A. Tours of the cost of the tour. On 28 May Mrs. Rossi went to the Sun Line office in Athens where she presented the exchange vouchers on behalf of her tour members and received passage tickets, boarding passes and luggage labels. In accordance with her usual practice as tour leader, she held on to the tickets and presented them when the members of her party boarded the Stella Oceanis on 30 May.

7. It is necessary to say something more about the documents received by the respondent, both for the purpose of determining when a contract was made and also to identify relevant terms of that contract. First, however, it should be mentioned that the exchange order received by the respondent was not issued directly by Mary Rossi Travel. Rather, it along with other exchange orders was issued in Sydney to Mary Rossi Travel by J.M.A. Tours. There was evidence from the general manager of J.M.A. Tours that until 1980 or thereabouts that organization held stocks of Sun Line Cruise tickets and issued those tickets in Sydney. Thereafter tickets were not made available to J.M.A. Tours by Sun Line Cruises and exchange vouchers were issued to Mary Rossi Travel and, no doubt, to other travel agents. According to the general manager, "There was no other documentation required by Sun Line Cruises other than the exchange vouchers."

8. The brochure which was given to the respondent's wife in Sydney before the booking was made is a glossy magazine of more than thirty pages, with many photographs and details of places involved in the appellant's cruises. It has details of cabins and their cost together with other information of a general nature relating to ships, crews and activities. On the inside of the back cover of the brochure, under the heading "Things To Know Before You Go", is information about cancellations and refunds, alterations to the itinerary, port taxes, baggage liability and the like. The information commences with the words, "The attention of passengers is drawn to the General Conditions of transportation set out in the Passage Contract." Under the heading "Responsibility" is a statement that "(t)he transportation of passengers and baggage ... is governed by the terms and conditions printed on the Passenger Ticket Contract which may be inspected at any Sun Line office. Passenger's acceptance of that ticket constitutes agreement of those terms and conditions." As already mentioned, no tickets were available in Sydney and none was received by the respondent until after arrival in Greece. It is unclear whether there was a "Sun Line office" in Australia. In the course of argument, counsel for the respondent contended that the appellant carried on business at the office of J.M.A. Tours in Sydney. This was the first time that such a contention had been advanced in the course of the proceedings. In disputing its correctness, counsel for the appellant replied that no attempt was made to serve process on the appellant in Sydney and that leave was sought and obtained to effect service in Greece. The relationship between the appellant and J.M.A. Tours does not appear to have been explored before Yeldham J. His Honour proceeded on the basis that the appellant did not carry on business in Australia. We consider we must do the same. It is not in issue that Mrs. Rossi received the ticket on behalf of the respondent.

9. The relevant exchange order set out the name of the ship, sailing date, time of sailing and of embarkation, ports of departure and arrival, names and cabin number, fare charged, nationality of the respondent and his wife, their sex and the fact that they were adults, total passage fare, port taxes and the full amount paid. It contained the following statement:

"CANCELLATION OF CRUISES OR ALTERATION OF ITINERARY Article 2 of the Sun Line passage contract specifies that in the event of the passenger cancelling his passage or not using it for the sailing for which it was issued, passage money will NOT be refunded. ONLY IF space released is resold will the passage money be refunded. Sun Line reserves the right to cancel any cruise, in which case the passage money will be refunded. Sun Line also reserves the right to alter the itinerary of any cruise if this should become necessary or desireable (sic) for any reason. Times of arrival and departure at the various ports of call are given as a general guide, but no guarantee can be given that they will be adhered to. This order will be exchanged for a Sun Line ticket when boarding vessel."

10. The passage ticket and contract is a document of several pages. It has on its face the words "Passage Ticket and Contract" together with the injunction "Each passenger should carefully examine this ticket, particularly the Conditions printed on pages 1, 2, 3 and 4 of its inside covers especially as regards limitation of liability, adjustment of fare rates etc." The ticket itself is a simple document, roughly comparable in form and content to the exchange order. There are very detailed "General Conditions" asserting that the terms and conditions referred to in "this ticket" and set forth on pp 1-4, "to which passenger expressly agrees", apply to and govern the relations between the passenger on the one hand and the carrier, master, vessel, owner, officers and crew and agents on the other. There is a notice: "The passenger's attention is particularly directed to the terms and limitations of this contract." The general conditions contain many references to "this passage contract". Clause 12(a) provides various exemptions from liability in respect of bodily injury and cl.12(f) limits any amount recoverable to US$5,000. Clause 13 reads in part:

"Notwithstanding anything to the contrary contained herein, any action against the Carrier must be brought only before the courts of Athens Greece to the jurisdiction of which the Passenger submits himself formally excluding the jurisdiction of all and other court or courts of any other country or countries which court or courts otherwise would have been competent to deal with such action."

Clause 16 contains this "acknowledgment":

"The passenger admits having read this passage contract and agrees that its provisions constitute the complete agreement between the Carrier and said Passenger."

11. When Mary Rossi Travel paid to J.M.A. Tours a deposit on behalf of the respondent, there was an offer by the latter to secure a passage on a particular Sun Line cruise. Whether a contract of carriage thereupon came into existence is doubtful, although the invoice of 7 April 1983 is headed "Final Invoice And Confirmation". But the parties did enter into such a contract once payment of the balance was made and an exchange order was issued. In the ordinary course a ticket would, at that stage, have issued to the respondent. For reasons connected no doubt with the appellant's administration, no tickets were available in Sydney. Nevertheless the exchange order constituted a contract made between the parties whereby in consideration of money paid by the respondent the appellant allocated to him an identified cabin on an identified cruise. It is true that by the exchange order the appellant reserved "the right to cancel any cruise, in which case the passage money will be refunded". On the other hand, "in the event of the passenger cancelling his passage ... passage money will NOT be refunded. ONLY IF space released is resold will the passage money be refunded." These may have been terms of the contract made between passenger and shipper; they did not prevent a contract from coming into existence. Whether the right to "cancel" a cruise was one that could be exercised arbitrarily or whether it was subject to some implication of reasonableness it is unnecessary to dwell upon. But a right in one party to determine a contract, even though there has been no breach by the other party, is by no means uncommon: see Anson's Law of Contract, 26th ed. (1984), p 438. If a contract of carriage was not concluded before the respondent left Australia then it must follow that, notwithstanding that the entire passage money had been paid and that a particular cabin on a particular vessel had been allocated to him for a specified cruise and that although nothing remained for him to do except to present himself in Athens with the exchange order, the appellant came under no obligation to carry him until he did so. Such a construction of the circumstances flies in the face of common sense and cannot be accepted. When he left Australia the respondent had a contractual right to receive from the appellant on presentation of the exchange order in Athens a passage ticket which enabled him to board the vessel and occupy the specified cabin for the duration of the cruise subject only to such conditions as are found to form part of the contract.

12. MacRobertson Miller Airline Services v. Commissioner of State Taxation (W.A.) (1975) 133 CLR 125, relied upon by the appellant, is not an obstacle to the conclusion that a contract of carriage was concluded in Sydney. It is true that the members of the Court (Barwick C.J., Stephen and Jacobs JJ.) held that a completed ticket issued by an airline company was not chargeable with duty as an "agreement or any memorandum of an agreement" within the Stamp Act 1921 (W.A.). The only document issued by the airline operator was a ticket handed to the passenger at the time of payment. The ticket contained a coupon on which the seat allocation was indorsed when the ticket was presented before departure. Inside the cover of the ticket were quite lengthy "conditions of carriage" in which the operator reserved the right to abandon any flight, to cancel any ticket or booking and to refuse to carry any passenger without assigning any reason therefor.

13. Barwick C.J. regarded the issue of the ticket as "mainly a receipt for the payment of the fare" and payment on making a reservation "as no more than the prepayment of the fare payable for an actual carriage performed" (at p 134). His Honour did suggest a possible distinction between a ticket issued by a steamship company and one issued by an airline operator when he said (at p 135):

"The marked degree of certainty on the one hand and of uncertainty on the other affords good ground for distinguishing the inferences which, apart from express provisions, might be drawn in the one case though not in the other."

Barwick C.J.'s analysis was largely dictated by the conditions of carriage in which the airline operator reserved the right to abandon flights, to cancel bookings and to refuse to carry any passenger. His Honour said (at p 133):

"The exemption of the ticket in this case fully occupies the whole area of possible obligation, leaving no room for the existence of a contract of carriage."

We pause to interpolate that this could not be said of the conditions set out in the ticket issued by the present appellant, even if those conditions formed part of the passage contract.

14. Jacobs J. adopted much the same approach as the Chief Justice but in addition took the view, as did Stephen J., that the completed ticket was merely an offer by the airline to carry the passenger, an offer which was accepted by the passenger's subsequent conduct. An offer in writing, which was accepted orally or by conduct, was not an agreement or memorandum of an agreement within the Act.

15. The ratio decidendi of the decision in MacRobertson Miller Airline Services lies in the proposition that there was no agreement or memorandum of agreement in writing, hence nothing that was chargeable with stamp duty. That does not determine the question whether, in the present case, there was a contract once the exchange order issued allocating a particular cabin to the respondent and with all remaining to be done being the exchange of the order for a ticket in Athens. For the reasons already given, there was such a contract.

16. Once it is accepted that there was a contract of carriage concluded between the parties in Sydney, there are formidable obstacles in the path of the appellant's argument that the conditions on the ticket and in particular the submission to Greek jurisdiction formed part of that contract. Yeldham J. was surely right in his view "that the brochure was not contractual in nature and did not enter into or form any part of the relevant contract of carriage". Essentially it was a document designed to interest would-be travellers in the appellant's cruises to various parts of the Mediterranean. It contained much that was of historical and geographical interest as well as displaying the facilities that were available to those participating in the cruises. It was advertising material, available to any one. Its reference under "Things To Know Before You Go" to the transportation of passengers being governed by the terms and conditions printed on the passenger ticket contract was informative but not contractual (cf. Hollingworth v. Southern Ferries Ltd. (The "Eagle") (1977) 2 Lloyd's Rep 70, at pp 75-77). And it was expressed in the context that the ticket contract "may be inspected at any Sun Line office". Such a statement was not particularly helpful if, as may have been the case, there was no Sun Line office in Australia.

17. Yeldham J. also concluded that the ticket "did not form any part of the contract" between the parties. And in that conclusion he was right. The ticket was issued after the contract was concluded. As just mentioned, the brochure was informative but not contractual; hence the appellant cannot rely upon it as a means of incorporating the terms and conditions on the ticket into the contract. The exchange order was part of the contract but it did not purport to incorporate the ticket. It is true that it made mention of "Article 2 of the Sun Line passage contract" but that was to make it clear that cancellation of passage was likely to involve forfeiture of the passage money. Nothing said on the exchange order operated to include, as part of the contract, terms and conditions on a ticket not provided to the respondent until after he had paid his fare in Sydney and had arrived in Greece to begin his Sun Line cruise. See generally The "Eagle"; Daly v. General Steam Navigation Co. Ltd. (The "Dragon") (1979) 1 Lloyd's Rep 257.

18. As earlier indicated, these conclusions as to when the contract was made and its terms have been arrived at on the basis of the evidence presently adduced and for the purpose of deciding whether a stay of proceedings is appropriate. Necessarily they are not final. They clarify the factual situation against which we have now to consider the important question of law raised by this appeal. The resolution of that question requires a consideration of the principles that should govern an application for a stay in the circumstances of a case such as this. Twenty years ago a somewhat similar question was considered by Gibbs J. in the Supreme Court of the Australian Capital Territory: Cope Allman (Australia) Ltd. v. Celermajer (1968) 11 FLR 488. In that case, the plaintiff company commenced proceedings in the Territory. The defendants lived in Sydney and the plaintiff carried on business in New South Wales but not in the Territory. The relevant Rules of Court provided that leave of the Court or a judge was not necessary for service of a writ of summons within the Commonwealth. The defendants sought a stay of the proceedings on the ground that the Court was not a convenient forum for the determination of the case. Gibbs J. (at p 494), applying the decision of this Court in Maritime Insurance Co. Ltd. v. Geelong Harbor Trust Commissioners (1908) 6 CLR 194, refused a stay, saying:

"Before I may decline to exercise jurisdiction and deny to the plaintiff its prima facie right to proceed in this Court I must be satisfied that there would be something amounting to vexation, oppression or injustice to the defendants. I am not so satisfied."

See also Rutt v. Metropolitan Underwriters (Australasia) Ltd. (1929) SASR 426; Telford Panel &Engineering Works Pty. Ltd. v. Elder Smith Goldsbrough Mort Ltd. (1969) VR 193.

19. The law enunciated by this Court in Maritime Insurance and applied by Gibbs J. followed the law of England as it had developed in the later years of the nineteenth century. The rule was stated succinctly by Scott L.J. in a much cited passage of his judgment in St. Pierre v. South American Stores (Gath &Chaves) Ltd. (1936) 1 KB 382, at p 398:

" The true rule about a stay ... may I think be stated thus: (1.) A mere balance of convenience is not a sufficient ground for depriving a plaintiff of the advantages of prosecuting his action in an English Court if it is otherwise properly brought. The right of access to the King's Court must not be lightly refused. (2.) In order to justify a stay two conditions must be satisfied, one positive and the other negative: (a) the defendant must satisfy the court that the continuance of the action would work an injustice because it would be oppressive or vexatious to him or would be an abuse of the process of the Court in some other way; and (b) the stay must not cause an injustice to the plaintiff. On both the burden of proof is on the defendant. These propositions are, I think, consistent with and supported by the following cases: McHenry v. Lewis 22 ChD 397; Peruvian Guano Co. v. Bockwoldt (1883) 23 ChD 225; Hyman v. Helm (1883) 24 ChD 531; Thornton v. Thornton 11 PD 176; and Logan v. Bank of Scotland (No. 2) (1906) 1 KB 141, 150, 151."

As so expressed, English law was in marked contrast to the doctrine of forum non conveniens which was well known to the law of Scotland and also to the courts of the United States of America.

20. The House of Lords had occasion to consider the question in 1973 in The Atlantic Star (1974) AC 436. The existing law was trenchantly criticized by Lord Reid (at p 453):

"They (the earlier authorities) support the general proposition that a foreign plaintiff, who can establish jurisdiction against a foreign defendant by any method recognised by English law, is entitled to pursue his action in the English courts if he genuinely thinks that that will be to his advantage and is not acting merely vexatiously. Neither the parties nor the subject matter of the action need have any connection with England. There may be proceedings on the same subject matter in a foreign court. It may be a far more appropriate forum. The defendant may have to suffer great expense and inconvenience in coming here. In the end the decisions of the English and foreign courts may conflict. But nevertheless the plaintiff has a right to obtain the decision of an English court. He must not act vexatiously or oppressively or in abuse of the process of the English court, but these terms have been narrowly construed."

The effect of the decision was to give to the words "vexatious" and "oppressive" a more flexible or liberal application than was the case previously. In The Abidin Daver (1984) AC 398, at p 411, Lord Diplock described the essential change in the attitude of the English courts that had been achieved as a result of the successive decisions of the House of Lords in The Atlantic Star, MacShannon v. Rockware Glass Ltd. (1978) AC 795, and Amin Rasheed Shipping Corporation v. Kuwait Insurance Co. (1984) AC 50 as being:

"that judicial chauvinism has been replaced by judicial comity to an extent which I think ... is, in the field of law with which this appeal is concerned, indistinguishable from the Scottish legal doctrine of forum non conveniens".

21. In MacShannon Lord Diplock (at pp 811-812), drawing on "the gist" of the speeches of the three members of the House of Lords who formed the majority in The Atlantic Star, restated the material part of the rule enunciated by Scott L.J. in St. Pierre as follows:

"'... In order to justify a stay two conditions must be satisfied, one positive and the other negative: (a) the defendant must satisfy the court that there is another forum to whose jurisdiction he is amenable in which justice can be done between the parties at substantially less inconvenience or expense, and (b) the stay must not deprive the plaintiff of a legitimate personal or juridical advantage which would be available to him if he invoked the jurisdiction of the English court'".

However, this statement, like other statements during the development of these principles since 1973, has now been overtaken. In Spiliada Lord Goff of Chieveley, in a speech concurred in by the other members of the House, made a definitive statement of the present law of England. His Lordship declared (at p 474) that in cases where jurisdiction has been founded as of right, that is, where the defendant has been served with proceedings within the jurisdiction, the defendant may now apply to the court to exercise its discretion to stay the proceedings on the ground which is usually called forum non conveniens. He cited with approval, as expressing the principle applicable in Scotland and now in England, the classic statement of Lord Kinnear in Sim v. Robinow (1892) 19 R. 665, at p 668:

"the plea can never be sustained unless the Court is satisfied that there is some other tribunal, having competent jurisdiction, in which the case may be tried more suitably for the interests of all the parties and for the ends of justice" (our emphasis).

Lord Goff then cited the restatement of Lord Diplock in MacShannon (which we have set out above), describing it as no more than "a tentative statement at an early stage of a period of development" (at p 475). Clearly, the fact that a stay might deprive the plaintiff of a legitimate personal or juridical advantage cannot be decisive if regard is to be had to the interests of all the parties and the ends of justice. His Lordship (at pp 476-478) detailed the approach which a court should take in determining whether or not to grant a stay. He did so on the basis that, notwithstanding the use of the Latin, the object is to find, not the convenient, but the appropriate forum. The court must first look for the forum with which the action has the most real and substantial connection. The connecting factors in this regard will include matters of convenience and expense, the law governing the relevant transaction and the places where the parties respectively reside or carry on business. If the court concludes at that stage that there is some other available forum which prima facie is clearly or distinctly more appropriate for the trial of the action (the onus of proof resting with the defendant), it will ordinarily grant a stay unless there are circumstances by reason of which justice requires that a stay should nevertheless not be granted (the onus of proof in this regard resting with the plaintiff).

22. It was argued for the respondent that the English law as definitively stated by Lord Goff in Spiliada is not the law of New South Wales and that the relevant principle is that stated by Scott L.J. in St. Pierre and applied by this Court in Maritime Insurance. On the other hand, such decisions as there have been in the courts in Australia since The Atlantic Star was decided in 1973 appear to have followed the English development: for examples of cases involving a forum of another nation, see The Courageous Coloctronis (1979) WAR 19, In the Marriage of Takach (1980) 47 FLR 441 and Starr v. Ortega (unreported, Supreme Court of New South Wales, 9 June 1987); as to cases involving one Australian forum vis-a-vis another Australian forum, see Ranger Uranium Mines Pty. Ltd. v. B.T.R. Trading (Qld.) Pty. Ltd. (1985) 34 NTR 1 and Batchelor v. Dahlia Mining Co. Ltd. (unreported, Court of Appeal of the Supreme Court of New South Wales, 19 August 1986). In the present case, Yeldham J. and all the members of the Court of Appeal accepted, at least in part, the recent English decisions as embodying the law which is to be applied.

23. We agree with Lord Goff's approach in Spiliada. In our view the evolution of English law since The Atlantic Star cannot be ascribed to local considerations such as the incorporation of the United Kingdom into the European Economic Community. Rather, this century has witnessed such a transformation in communications and travel, coupled with a greater importance attaching to considerations of international comity as the nations of the world become more closely related to each other, as to render the St. Pierre principle, fashioned as it was in the nineteenth century, inappropriate to modern conditions. In this regard we agree with the views expressed by Kirby P. in the Court of Appeal. The St. Pierre principle places such a tight rein on the discretion of a court as to render it unable to deal justly with the problem of forum shopping, even in blatant cases. See Schuz, "Controlling Forum-Shopping: The Impact of MacShannon v. Rockware Glass Ltd" (1986) 35 International &Comparative Law Quarterly 374, at pp 377-378. And there is force in the comment of Pryles, "Liberalising the Rule on Staying Actions - Towards the Doctrine of Forum Non Conveniens" (1978) 52 Australian Law Journal 678, at p 684:

"The common law jurisdictional rules (that is, the sufficiency of personal service within the jurisdiction) are not entirely satisfactory and can lead to the assumption of jurisdiction in the most tenuous circumstances where there is really no significant connection between the litigation and the forum.... In these circumstances a liberal rule as to the staying of actions is required. It cuts down local parochialism as regards judicial adjudication, and is consistent with a spirit of international legal cohesion and integration."

24. Furthermore, in an area of the law involving the courts of other countries it is expedient to preserve as much consistency as possible between the common law countries. The doctrine of forum non conveniens has long formed part of the law of Scotland and of the United States of America. It is now the law of England. It would seem to be the law of Canada: see, for example Antares Shipping Corp. v. The Ship "Capricorn" (1976) 65 DLR (3d) 105; Bonaventure Systems Inc. v. Royal Bank of Canada (1986) 32 DLR (4th) 721; cf. Rogers v. Bank of Montreal (1984) 4 DLR (4th) 507. We are unaware of any recent consideration of the question in the courts of New Zealand. In our view, the Spiliada approach should henceforth chart the course for the common law of Australia in relation to the inherent jurisdiction of a court to stay proceedings when there is a more appropriate forum in a foreign country.

25. Likewise, we think that the reasoning of Lord Goff (at pp 480-482 in Spiliada) in drawing attention to a marked resemblance between the principles applicable in forum non conveniens cases and those which govern the discretionary power of a court to permit service of proceedings on a defendant outside the jurisdiction, is relevant and applicable in Australia.

26. Yeldham J. took as his yardstick in determining the application for a stay the statement of Lord Diplock in MacShannon that we have cited. The decision of the House of Lords in Spiliada had not then been given. His Honour, having engaged in a balancing exercise involving the relevant factors, concluded that the appellant had failed to establish that if action was brought by the respondent in the Greek courts justice could be done between the parties at substantially less inconvenience and expense. He also found that, having regard to the language difficulties which the respondent and his witnesses would face in the course of a trial in Greece and the necessity to instruct lawyers in Greece, a stay would deprive the respondent of a legitimate personal or juridical advantage.

27. The Court of Appeal had the benefit of the decision in Spiliada. However, the majority (McHugh J.A., with whose reasons Glass J.A. agreed) appear to have attached determining significance to the question whether the respondent would suffer a legitimate personal or juridical disadvantage if the action were stayed. In taking this course, their Honours were following the MacShannon formulation. Having found that the contract of passage was made in New South Wales, and assuming that the conditions printed on the ticket were incorporated into it, McHugh J.A. concluded that the respondent would suffer a severe juridical disadvantage if he could not invoke the provisions of the Contracts Review Act 1980 (N.S.W.) for the purpose of invalidating the exclusionary and limitation provisions of the contract. Otherwise, the advantages and disadvantages of bringing the action in either forum were found to be reasonably evenly balanced. If the restrictive conditions did not form part of the contract, so that resort to the Act was unnecessary, the majority would have dismissed the appeal on the ground that Yeldham J. did not err in the exercise of his discretion to refuse a stay.

28. Our provisional conclusion that the contract was made in New South Wales and that it did not include the conditions set out on the passage ticket that was made available for the first time in Greece makes it unnecessary to consider in any detail the relevance that might otherwise have attached to the Contracts Review Act. It suffices to say that in our opinion there is no present basis upon which that factor could be brought into the inquiry undertaken to determine whether or not a stay should be granted. Section 16 of the Act sets out the periods during which an application for relief under the Act may be made. No application has been made and it is doubtful whether any application could be made without falling foul of that section. The point was not taken in the courts below. Note also s.17(3) which provides for the Act to apply only to contracts the proper law of which is, or but for a particular provision of the contract would be, New South Wales. We address the question of the proper law of the contract later in these reasons.

29. It remains to consider whether there was any miscarriage of the discretion exercised by Yeldham J. It is to be noted that in Spiliada Lord Templeman (at p 465) emphasized that the solution of disputes about the relative merits of trial in England and trial abroad is pre-eminently a matter for the trial judge and that an appellate court should be slow to interfere. It was unfortunate for Yeldham J. that he was required to determine the appellant's application at a time when the relevant law was still evolving in England; the House of Lords had heard argument in Spiliada but was yet to deliver its decision. As we have said, his Honour applied the law as stated by Lord Diplock in MacShannon (at p 812, which we have already cited). It bears repeating that this statement was described by Lord Goff in Spiliada "as a tentative statement at an early stage of a period of development" (at p 475). Lord Goff proceeded to state the basic principle in the following terms (at p 476):

"a stay will only be granted on the ground of forum non conveniens where the court is satisfied that there is some other available forum, having competent jurisdiction, which is the appropriate forum for the trial of the action, i.e. in which the case may be tried more suitably for the interests of all the parties and the ends of justice".

There is clearly a difference of emphasis between the two statements: first, to focus the search on the appropriate forum supplies a broader frame of reference than a concentration on convenience and expense; secondly, the absence of any reference to a legitimate personal or juridical advantage in the Spiliada statement diminishes the prominence which that consideration is to have in the inquiry. Furthermore, what is to the advantage of one party will almost certainly be to the disadvantage of the other. A limitation provision may disadvantage a plaintiff if he is required to take proceedings elsewhere; equally, it may disadvantage the defendant if the action is not stayed. See Briggs, "Forum Non Conveniens - The Last Word?" (1987) Lloyd's Maritime &Commercial Law Quarterly 1, at pp 3-4. A plaintiff may expect to receive higher damages in one jurisdiction than another; is that a legitimate advantage? Cf. Castanho v. Brown &Root (U.K.) Ltd. (1981) AC 557 and Smith Kline &French Laboratories Ltd. v. Bloch (1983) 1 WLR 730; 2 All ER 72. In de Dampierre v. de Dampierre (1988) 1 AC 92, at p 110, Lord Goff said the conclusion reached in Spiliada was that:

"having regard to the underlying principle, the court should not, as a general rule, be deterred from granting a stay of proceedings simply because the plaintiff in this country will be deprived of such an advantage, provided that the court is satisfied that substantial justice will be done in the appropriate forum overseas".

30. In the circumstances, we do not think it would be right for us simply to endorse or reject the conclusion reached by Yeldham J. in the exercise of a discretion informed and guided by Lord Diplock's statement. We must therefore undertake the inquiry ourselves. We do so, however, bearing in mind that once the jurisdiction of the Supreme Court of New South Wales was properly invoked, the onus lay on the appellant to convince the Court that trial of the action in Greece was clearly more suitable. Recognition of this onus helps to avoid some of the difficulties adverted to by Professor Robertson in his article "Forum Non Conveniens in America and England: 'A Rather Fantastic Fiction'" (1987) 103 Law Quarterly Review, p 398. The respondent, having obtained leave under Pt.10, r.1(e) of the Rules of Court to serve the originating process on the appellant in Greece, must be credited with having been entitled to invoke the jurisdiction of the Supreme Court of New South Wales. There is no question of abuse of process. It is true that although he underwent considerable medical treatment in New South Wales in respect of the injuries he suffered in the accident, the respondent resides and practises his profession in Queensland. However, we do not consider that the respondent is to be disadvantaged by the fact that he is not a resident of New South Wales. He is an Australian resident and in all the circumstances he ought not be treated as a foreign plaintiff engaged in forum shopping.

31. The majority in the Court of Appeal placed weight on the terms of r.1(e), believing that the principle of forum non conveniens was not necessarily applicable in its entirety to an action brought in reliance on that rule. We think that any misgiving along those lines is misplaced. Indeed, we think that the converse is true. The discretion to grant leave to serve process outside the jurisdiction and so to subject a foreigner to the jurisdiction of a New South Wales court should be exercised with due regard to the principle of forum non conveniens. In Spiliada Lord Goff, referring to the discretion to grant leave under R.S.C., O.11, r.1(1)(f) for service of a writ out of the jurisdiction, stated the position correctly when he said (at p 480) that the question in such a case must be, at bottom, to identify the forum in which the case can be suitably tried for the interests of all the parties and for the ends of justice. His Lordship then proceeded to identify the distinctions between such a case and the operation of the doctrine of forum non conveniens. One of these distinctions is material to a rule such as r.1(e), which in old-fashioned language may be described as founding an "exorbitant" jurisdiction, that is a jurisdiction which was described by Lord Diplock in Amin Rasheed, at p 65, as one:

"which, under general English conflict rules, an English court would not recognise as possessed by any foreign court in the absence of some treaty providing for such recognition. Comity thus dictates that the judicial discretion to grant leave under this paragraph of R.S.C., Ord.11, r.1(1) should be exercised with circumspection in cases where there exists an alternative forum...."

We should add that although the New South Wales Rules, unlike their English counterpart, do not expressly provide that leave shall not be granted "unless it shall be made sufficiently to appear to the court that the case is a proper one for service out of the jurisdiction" (R.S.C., O.11, r.4(2)), such an injunction is necessarily implicit in the discretionary power to grant leave. The special character of the leave in this case serves to diminish the weight that in other circumstances might attach to a plaintiff's choice of forum.

32. We begin our search for the appropriate forum by asking the question - with which forum has the action the most real and substantial connection? On our provisional finding the contract of carriage, in the course of the performance of which the alleged tort was committed, was made in New South Wales. That is certainly a material consideration but it must be remembered that the action is not an action for breach of contract. It is an action in tort for a wrong allegedly committed by an appellant which is incorporated in Greece and carries on business there, in respect of an accident which occurred in Greek waters on a Greek vessel in the course of a cruise which had its point both of departure and return in a Greek port. The significance of forming a view as to where the contract of carriage was made lies in the consequences for the content of that contract and in particular the place, if any, of cll.12 and 13 of the ticket in that contract. But the application for a stay was not founded upon the submission to Greek jurisdiction contained in cl.13. It was based on the doctrine of forum non conveniens; the existence of cl.13 was one of a number of matters upon which the appellant relied in support of its application. It seems to us also, although the proposition is contested by the respondent and notwithstanding our conclusion that the contract was made in New South Wales, that prima facie the proper law of the contract is the law of Greece. The test for discovering the proper law of the contract - that is, in general terms, "the substantive law of the country which the parties have chosen as that by which their mutual legally enforceable rights are to be ascertained" (per Lord Diplock in Amin Rasheed, at pp 61-62) - is well established. One looks for "the system of law by reference to which the contract was made or that with which the transaction has its closest and most real connexion": Bonython v. Commonwealth of Australia (1951) AC 201, at p 219. The contract being provisionally found to be constituted by nothing more than the payment of the fare and the issuing of an exchange order, the printed conditions on the passage ticket not being incorporated in the contract, there is obviously no express identification of the proper law. The decisive consideration, in our view, is that the contract was to be wholly performed in Greece or in localities close to Greece. An additional factor in support of Greek law as the proper law of the contract is that passengers for the cruise provided by the appellant were drawn from the United States of America as well as Australia and no doubt from other countries. It would be extraordinary, as Kirby P. observed, if the obligations of the appellant towards its passengers were to be governed by a variety of different laws, depending on where the fare was paid and the contract concluded.

33. Other factors have been canvassed by counsel for the parties, mostly concerned with witnesses and questions of convenience and expense. We are content to accept the view of the majority of the Court of Appeal that they are fairly evenly balanced.

34. In our opinion, the factors that we have mentioned identify Greece as an available forum which is clearly more appropriate for the trial of the action. In that case, following the sequence of steps outlined by Lord PGoff in Spiliada (at p 478), we should favour granting a stay unless there are circumstances by reason of which justice requires that a stay should nevertheless not be granted. The onus of establishing the existence of circumstances having such an effect rests upon the respondent. It is at this point that we must consider any particular disadvantage personal to the respondent that he would suffer if he is required to litigate his claim in Greece. In answer to a suggestion by the respondent that currency restrictions might preclude him from removing the proceeds of any judgment obtained in Greece, the appellant is prepared to pay any such judgment in Australian dollars and to give security in New South Wales for that payment. This removes what might otherwise be a serious disadvantage to the respondent. There is the additional personal expense that the respondent will have to incur in litigating in Greece, but this is not a factor which carries much weight. Then there is the disadvantage arising from his lack of knowledge of the Greek language. He may have to rely on interpreters in order to communicate adequately with his lawyers and would need interpreters to understand the course of the proceedings. This is undoubtedly a handicap that the respondent would feel keenly and it deserves serious consideration. Furthermore, there is probably no countervailing disadvantage to the appellant if the action were to be heard in New South Wales. The appellant is a corporation of substance with wide international experience and for which a trial in New South Wales would be unlikely to pose a significant problem.

35. Notwithstanding these considerations, however, we are not persuaded that they are of sufficient weight to enable us to disregard the factors that so clearly point to Greece as the appropriate forum. Greece was the place of the alleged tort; it occurred on a Greek vessel in the course of the performance of a contract of carriage of which prima facie the proper law was the law of Greece. The appellant has no connection with New South Wales, its place of business being in Greece. The Contracts Review Act of New South Wales has ceased to be of any relevance. The necessity for the respondent to depend upon an interpreter, although distressing to him personally, cannot affect the quality of justice that he might expect to receive in a Greek court. The facts of the incident, so far as he can testify to them, are brief and uncomplicated and should not present him with any difficulty in instructing those who represent him. An increasing number of litigants in Australian courts must rely on interpreters and it would be a grave reflection on the administration of justice generally if it were thought to impose serious disadvantage.

36. We think it necessary to say something about the phrase "the ends of justice" which was used by Lord Kinnear in Sim v. Robinow and adopted by Lord Goff in Spiliada. The relevant inquiry does not require the court to embark at the outset upon an investigation of the relevant law that would be applied if the action were to be determined in some other court. For instance, in the present case the Court is not directly concerned with the likely fate of an argument in a Greek court that the respondent is bound by the terms of cl.12 of the ticket. The expression "the interests of all the parties and the ends of justice" is a composite one. This is best understood and given effect to by recognizing that the initial onus lies on the appellant (in this case) to demonstrate that some forum other than New South Wales is more appropriate because it is the forum with which the action has the most real and substantial connection. The substantive law to be applied in either forum is not, in this regard, a material consideration. If that onus is satisfied, it is then for the respondent (in this case) to persuade the Court that the interests of the parties and the ends of justice will nevertheless best be served by refusing a stay. He might do so by showing that he will be deprived of a "legitimate personal or juridical advantage" in the alternative forum (cf. MacShannon, at p 812). He might show (in the present case for instance) that if he brought the action in Greece the ticket is likely to be treated as part of the contract of carriage and that there is no power in a Greek court to override a provision such as cl.12. Or he might point to the risk that a foreign litigant will not get justice in such a court: The Abidin Daver, at p 411. In the absence of any evidence on these matters, they cannot supply any sound basis for a conclusion that the interests of all the parties and the ends of justice will not be best served by an order which results in the action being heard in that forum with which it has the most real and substantial connection.

37. Although we have from time to time referred to the court's discretion to stay proceedings on the ground of forum non conveniens, the expression is apt to mislead unless properly understood. The discretion is to decline to exercise the jurisdiction vested in the court. If the party seeking a stay fails to satisfy the court that some other forum is more appropriate, that is the end of the matter. In making that assessment, the court conducts the sort of inquiry we have indicated. If the court is satisfied that an alternative forum is more appropriate, it will grant the stay unless persuaded that the consequences for the plaintiff are such that a stay should be refused. Again, that assessment will depend upon the sort of considerations to which we have referred. The discretion may be exercised only in accordance with and within the limits of these principles.

38. Having regard to the interests of both the parties and to the ends of justice, we conclude that the proceedings in the Supreme Court of New South Wales should be stayed.

39. Since preparing these reasons for judgment we have had the opportunity of reading the reasons prepared by the other members of the Court. It is apparent that the decision of the Court, while resolving the immediate dispute between the parties, does not yield a precise and authoritative statement of the principles that should be applied in dealing with an application to stay proceedings. That statement must await another day.

40. We would allow the appeal.

BRENNAN J: The plaintiff, Dr Fay, and his wife were passengers aboard the M.S. "Stella Oceanis", a Greek vessel, cruising between the islands of Samos and Ikaria in Greek waters on 2 June 1983 when an accident happened. A shot gun exploded during a shipboard entertainment of trapshooting and Dr Fay was severely injured. He commenced proceedings in the Supreme Court of New South Wales on 10 September 1985 by issuing a statement of claim against the defendant, a Greek corporation (and a subsidiary of a Delaware corporation) which owns, operates, equips and crews the M.S. "Stella Oceanis". The plaintiff alleged that his injuries were caused by negligence on the part of the defendant, its servants and agents.

2. He further alleged that he "suffered loss and damage partly in the State of New South Wales", an allegation of a fact which attracted the application of Pt 10 r.1(1)(e) of the Rules of the Supreme Court as it then stood. That sub-rule provided:

"(1) Subject to rule 2, originating process may be served outside the State in the following cases - ... (e) where the proceedings are founded on, or are for the recovery of, damage suffered wholly or partly in the State caused by a tortious act or omission wherever occurring".

Pursuant to r.2(1), the plaintiff obtained ex parte an order giving him leave to serve the originating statement of claim upon the defendant at its principal place of business in Athens in the Republic of Greece. The statement of claim was served accordingly and the defendant entered a conditional appearance. It then moved for an order that the statement of claim be set aside or struck out on the ground that the Court had no jurisdiction or for an order that service of the statement of claim be set aside or for an order that the proceedings be stayed. Yeldham J. dismissed the defendant's notice of motion and his decision was affirmed on appeal by a majority of the Court of Appeal (Glass and McHugh JJ.A., Kirby P. dissenting). On appeal to this Court, the defendant put at the forefront of its argument the proposition that the Supreme Court has jurisdiction to stay or dismiss the action on the ground of forum non conveniens and the defendant sought an order in exercise of that jurisdiction. A similar order was made by the Supreme Court of the State of New York in proceedings earlier commenced in that Court by the plaintiff against the defendant, the courts of Greece being considered to be the appropriate forum. Before examining the relevant principles of private international law as they have developed in this country, the material facts should be more fully stated.

3. Dr and Mrs Fay, who live in Nerang in Queensland, engaged the services of a travel agency conducted by Mrs Fay's mother, Mrs Mary Rossi, to arrange their overseas trip. The offices of Mary Rossi Travel are in Sydney. Mary Rossi Travel furnished a brochure relating to the cruise to Dr and Mrs Fay, and subsequently made a booking on their behalf with JMA Tours, another Sydney travel agency, which is the Australian agent for Sun Line Cruises ("Sun Line"). That firm or enterprise consists of the defendant and another corporation both of which operate ships which cruise in Greek waters. Mrs Mary Rossi was to lead a party of clients including the Fays on the cruise of the "Stella Oceanis". Mary Rossi Travel, being put in funds by Dr and Mrs Fay, paid JMA Tours in Sydney the fares payable on their behalf and JMA Tours issued in the names of Dr and Mrs Fay a document described as an "Exchange Order". The Exchange Order was on a printed form which provided spaces in which the issuing office enters particulars of the intending passenger, the ship and cruise which has been booked, the intending passenger's cabin and berth, and the fare and port taxes paid. The Exchange Order bore the following endorsement:

"CANCELLATION OF CRUISES OR ALTERATION OF ITINERARY Article 2 of the Sun Line passage contract specifies that in the event of the passenger cancelling his passage or not using it for the sailing for which it was issued, passage money will NOT be refunded. ONLY IF space released is resold will the passage money be refunded. Sun Line reserves the right to cancel any cruise, in which case the passage money will be refunded. Sun Line also reserves the right to alter the itinerary of any cruise if this should become necessary or desirable for any reason. Times of arrival and departure at the various ports of call are given as a general guide, but no guarantee can be given that they will be adhered to. This order will be exchanged for a Sun Line ticket when boarding vessel." (Emphasis added.)

4. In fact Mrs Rossi exchanged the Exchange Orders issued to her touring party for tickets at the Sun Line office in Athens on 28 May. She retained the tickets and attended to the formalities on behalf of her party when they boarded the "Stella Oceanis" at Piraeus on 30 May 1983. The tickets issued by the defendant were in the form of a booklet containing coupons one of which had to be surrendered on boarding and one of which the passenger or his agent retained. Mrs Rossi destroyed the plaintiff's coupon a day or two after boarding. On its front cover the ticket was described as "Passage Ticket and Contract". Amongst other printing on its front cover this notice appeared:

"Each passenger should carefully examine this ticket, particularly the Conditions printed on pages 1,2,3 and 4 of its inside covers especially as regards limitation of liability, adjustment of fare rates etc."

Each coupon inside the cover of the ticket bore the printed notice:

" The Conditions printed on pages 1,2,3 and 4 of the cover of this ticket form part of this contract."

5. Clauses 12 and 13 of the printed conditions are to be found on pp 3 and 4 of four closely printed pages of "general conditions". Clause 12 contains stipulations as to exemption from and limitation of liability for damages. Clause 13 contains provisions relating to notice and time limitations for commencing proceedings. Clause 13 also contains the following:

"13 Notwithstanding anything to the contrary contained herein, any action against the Carrier must be brought only before the courts of Athens Greece to the jurisdiction of which the Passenger submits himself formally excluding the jurisdiction of all and other court or courts of any other country or countries which court or courts otherwise would have been competent to deal with such action". (Emphasis added.)

6. Dr Fay knew nothing of these conditions. He left all arrangements to Mrs Rossi and her travel agency. If Dr Fay had examined closely the brochure which he and Mrs Fay had been given before they decided to book their passage, he would have found a declaration that the transportation of passengers is "governed by the terms and conditions printed on the Passenger Ticket Contract which may be inspected at any Sun Line office". The brochure stated that JMA Tours in Sydney was a Sun Line office. Dr Fay had not read this part of the brochure and, in any event, no copy of the passenger ticket contract was available at JMA Tours. Dr Fay was also unaware of the conditions printed in cll.12 and 13 of the ticket. Whether his agent Mrs Rossi knew of those conditions does not appear. She filed an affidavit which was silent on that point and she was not cross-examined.

7. As this appeal is brought from a judgment of the Supreme Court of New South Wales, the issues arising on this appeal fall to be determined by the law administered by that Court. That law is, of course, the law of New South Wales and, in particular, the private international law of that State. Before identifying the issues for determination, it is convenient to mention some problems with which this appeal is not concerned. First, the appeal is not concerned with the recognition or enforcement in Greece or elsewhere outside Australia of any judgment which might be entered in this action. Those are matters for the law of the place where recognition or enforcement might be sought at some later time. The Supreme Court of New South Wales has no power to compel recognition or enforcement of its judgments by the courts of another country. Next, the defendant does not now challenge the effectiveness of the service of the originating statement of claim pursuant to an order giving leave to serve the originating process on the defendant in Greece under Pt 10 rr.1(1)(e) and 2(1). The validity of those rules is not now in question (cf. Flaherty v. Girgis (1987) 162 CLR 574; (1985) 4 NSWLR 248) and no challenge is made to the sufficiency of the service to satisfy the terms of the order giving leave to serve. Nor is it in dispute that, subject to service, the Supreme Court has jurisdiction to entertain an action for damages for personal injury tortiously inflicted outside New South Wales when certain qualifications, which we need not now consider, are met. The substantial question on this appeal is, as it was in the Courts below, whether the Supreme Court should order that the action be stayed or dismissed on the ground either that the plaintiff is bound by an agreement that "any action against the Carrier must be brought only before the courts of Athens Greece" or that, having regard to all the circumstances of the case, Greece is the appropriate forum for the litigation of the plaintiff's claim and the Supreme Court of New South Wales should dismiss or stay the action in that Court in the exercise of a discretion, leaving the plaintiff to pursue his remedy (if any) in Greece. These grounds require separate consideration.

Exclusive foreign jurisdiction clause

8. Where the parties to a contract agree that the courts of a foreign country shall have exclusive jurisdiction to decide disputes arising under the contract or out of its performance, the courts of this country regard that agreement as a submission of such disputes to arbitration and will, in the absence of countervailing reasons, stay proceedings brought here to decide those disputes: Huddart Parker Ltd v. The Ship Mill Hill (1950) 81 CLR 502, at p 508; Compagnie des Messageries Maritimes v. Wilson (1954) 94 CLR 577, at pp 582,585,589-591. But when a clause purporting to confer exclusive jurisdiction on the courts of a foreign country to determine claims arising under or out of the performance of a contract of carriage is found in a ticket issued to a passenger who, in this country, has paid his fare for carriage on a ship, aircraft, or vehicle operated by the defendant, a preliminary question must be decided: is the clause a term of the contract of carriage? To answer that question, it is necessary to decide when the contract of carriage is made and by reference to what system of law are its terms to be ascertained. The payment of the fare is not necessarily the making of the contract: it may be a pre-payment of the consideration payable under a contract of carriage yet to be made (that is the character which the defendant's submission would assign to the payment made on the plaintiff's behalf to JMA Tours in Sydney) or it may be payment of the consideration payable under a contract of carriage thereupon made (the plaintiff's submission) or it may be the payment of the price of an option to require the carrier to carry the passenger, perhaps subject to certain conditions.

9. It may be thought that the terms of a contract should be ascertained by reference to its proper law, that is, the system of law by reference to which the contract is made or the system of law with which the transaction has its closest and most real connection: Bonython v. Commonwealth of Australia (1951) AC 201, at p 219. A submission to the exclusive jurisdiction of the tribunals of a particular country is an indicium of the parties' intention that the law of that country is to be the proper law of their contract: Compagnie d'Armement Maritime S.A. v. Compagnie Tunisienne de Navigation S.A. (1971) AC 572. And so, in the present case, if the supposed submission to the exclusive jurisdiction of the Athenian courts is in truth a term of the contract of carriage governing the liability of the defendant for the plaintiff's injury, there is a significant indicium that Greek law is the proper law of that contract. There are other indicia tending towards the same conclusion: the flag of the M.S. "Stella Oceanis", the domicil of the ship's owner and operator and the fact that the ship was to sail from and return to Piraeus and cruise in Greek waters are factors tending to a finding that Greek law is the proper law of the contract of carriage. But, for the purpose of determining whether the contract of carriage was made when the fares were paid to JMA Tours in New South Wales and whether that contract contained the exclusive foreign jurisdiction clause set out in cl.13 of the ticket, the system of law by reference to which those questions must be answered cannot be identified by assuming that the contract contained the clause. The question whether a contract has been made depends on whether there has been a consensus ad idem and the terms of the contract, if made, are the subject of that consensus. At all events, those are the issues which an Australian court necessarily addresses when it seeks to determine the existence of what the municipal law of this country classifies as a contract. Classification is, of course, a matter for the law of the forum. In deciding whether a contract has been made, the court has regard to all the circumstances of the case including any foreign system of law which the parties have incorporated into their communications, but it refers to the municipal law to determine whether, in those circumstances, the parties reached a consensus ad idem and what the consensus was: cf. Mackender v. Feldia A.G. (1967) 2 QB 590, per Diplock L.J. at pp 602-603. There is no system other than the municipal law to which reference can be made for the purposes of answering the preliminary questions whether a contract has been made and its terms. Mr D.F. Libling "Formation of International Contracts" (1979) 42 Modern Law Review 169 (an article to which Gaudron J. has drawn my attention) discusses the reasons why it is inappropriate to determine those questions by reference to the so-called putative proper law of a supposed contract.

10. The first step in determining whether the contract of carriage contains the exclusive foreign jurisdiction clause set out in cl.13 of the ticket is to determine whether the contract of carriage was entered into when Mary Rossi Travel (as agent for the plaintiff) paid the plaintiff's fare to JMA Tours in Sydney (as agent for the defendant). If, as the defendant submits as one limb of its argument, no contract of carriage was made in Sydney, the contract of carriage must have been made in Greece at or after the time when the ticket was issued to Mrs Rossi as the plaintiff's agent. The defendant's submission that no contract was made in Sydney is based on the endorsement on the exchange order which reserved to "Sun Line" the "right to cancel any cruise". The reservation of that right, it is said, makes any promise of carriage illusory and thus denies the existence of a contract of carriage.

11. In MacRobertson Miller Airline Services v. Commissioner of State Taxation (W.A.) (1975) 133 CLR 125, the terms printed on an airline ticket, which had been issued on payment of the fare, reserved to the carrier the right to abandon any flight, to cancel any booking and to refuse to carry the passenger. It was held that the ticket was not liable to stamp duty as an agreement or memorandum of agreement. Barwick C.J. said (at p 133):

"The exemption of the ticket in this case fully occupies the whole area of possible obligation, leaving no room for the existence of a contract of carriage."

Jacobs J. (at p 148) also regarded the exemption clause as showing that the carrier "undertakes no executory obligation which creates rights in an obligee". Stephen J. did not find it necessary to reach that conclusion (at p 140). The defendant submits that the exemption clause in the Exchange Order is comparable with the clauses in the ticket in MacRobertson Miller. As the exemption clause in the Exchange Order is significantly different from the exemption clauses in the ticket in MacRobertson Miller, it is not necessary to analyse the construction which Barwick C.J. and Jacobs J. placed on those clauses in that case. The exemption endorsed on the Exchange Order is not so wide as to preclude the existence of any contractual obligation on the part of the defendant when the Exchange Order was issued. To the contrary, the Exchange Order contains promises to refund the fare if the cruise is cancelled and to exchange the Exchange Order for a "Sun Line ticket when boarding vessel" if the cruise is to proceed. So far as appears from the terms of the Exchange Order, if the cruise proceeds, the passenger is contractually entitled on presentation of the Exchange Order to a ticket entitling him to be carried. The defendant reserves no right to cancel any ticket or booking or to refuse to carry the passenger named in the Exchange Order if the booked cruise proceeds. True it is that cl.3 of the Sun Line ticket purports to reserve those rights but, if the contract is made when the fare is paid, the ticket cannot alter the parties' contractual rights and obligations. If it had been intended that no contract should come into existence before the issue of the ticket "when boarding vessel", no consideration would have moved from the defendant to support the defendant's right (as asserted in the Exchange Order) to refuse to refund the passage money in the event of a passenger cancelling his passage. The proposition that no contract was made when the Exchange Order was issued in Sydney must be rejected. Next it is necessary to determine whether the contract then made was the contract of carriage and, if so, whether it contained the exclusive foreign jurisdiction clause.

12. The contract made when the Exchange Order was issued obliged the defendant to issue a ticket in exchange for the Exchange Order when the passenger was boarding the vessel. A ticket containing conditions of carriage is ordinarily treated as an offer by the carrier to carry on those conditions, no contract coming into existence until the offer is accepted by the passenger. This was a ground assigned by each of the judgments in MacRobertson Miller for holding the ticket not to be an agreement or a memorandum of agreement. Their Honours held that there was no contract of carriage until some time after the ticket had been issued - until the time when the passenger was provided with a seat (per Barwick C.J. at p 134) or when the passenger had intimated his acceptance of the ticket and its conditions or after the passing of a reasonable time during which the passenger has had a reasonable opportunity of reading the ticket and its conditions (per Stephen J. at p 139) or when the passenger presents the ticket and embarks on the carriage (per Jacobs J. at p 146). As Stephen J. said (at p 137):

" The conventional analysis of the formation of contracts for the carriage of passengers in those somewhat more leisurely transactions which involve the issue of a ticket in return for payment of a fare and the subsequent performance of the contract by the act of transportation, is to regard the ticket as the offer, the contract being made upon acceptance of that offer by the passenger".

13. But the conventional analysis cannot be applied to a ticket which the defendant is obliged to issue in exchange for an Exchange Order when a passenger is boarding a vessel. It can hardly have been the parties' intention at the time when the passenger pays his fare that the ticket to be given him on boarding should be a mere offer of carriage. Much less could it have been their intention that the offer might contain exemption clauses which were unknown to the passenger when the original contract was made. The arrangements contemplated at the time of the issue of the Exchange Order for exchanging that document for a ticket cannot reasonably support the hypothesis that when issued the ticket might be a mere offer containing exemption clauses which should bind the plaintiff only upon subsequent acceptance. Apart from the insufficiency of opportunity for the passenger who is boarding a vessel to read the conditions printed on the ticket and to elect whether to accept them, the election could be made only after travelling to Greece and obtaining the ticket, and the terms of the Exchange Order would require a passenger who then elected to decline the offer to forfeit the fare already paid. The better analysis of the transaction is that the defendant was bound to issue a ticket in exchange for the Exchange Order in performance of a contract of carriage already made, but the defendant was given no right to introduce new conditions of carriage by printing them on the ticket. The payment of the fare may rightly be regarded as the price of an option to acquire a ticket, but the option was not to acquire a mere piece of paper. It was an option to acquire a voucher or certificate of entitlement to be carried on terms already agreed - not on terms which the parties had yet to agree on.

14. It was too late after the original contract was made to add conditions which were not incorporated in it. The inclusion of cl.13 on the ticket could not alter the terms of a contract already made: Olley v. Marlborough Court (1949) 1 KB 532. A condition printed on a ticket is ineffective to alter a contract of carriage if the ticket is issued after the contract is made: Daly v. General Steam Navigation Co.Ltd. (The "Dragon") (1979) 1 Lloyd's Rep 257, at p 262. Perhaps the defendant expected that the contract made when the Exchange Order was issued would contain all the terms and conditions which, according to the brochure given to Dr Fay, were printed on "the Passenger Ticket Contract which may be inspected at any Sun Line office". But, as we shall see, that expectation was not fulfilled, and not simply because no copy of the Passenger Ticket Contract was available at JMA Tours in Sydney.

15. If a passenger signs and thereby binds himself to the terms of a contract of carriage containing a clause exempting the carrier from liability for loss arising out of the carriage, it is immaterial that the passenger did not trouble to discover the contents of the contract. But where an exemption clause is contained in a ticket or other document intended by the carrier to contain the terms of carriage, yet the other party is not in fact aware when the contract is made that an exemption clause is intended to be a term of the contract, the carrier cannot rely on that clause unless, at the time of the contract, the carrier had done all that was reasonably necessary to bring the exemption clause to the passenger's notice: Hood v. Anchor Line (Henderson Brothers) Ltd. (1918) AC 837, at pp 842, 844; McCutcheon v. David Macbrayne Ltd. (1964) 1 WLR 125, at p 129; (1964) 1 All ER 430, at p 433; Thornton v. Shoe Lane Parking Ltd. (1971) 2 QB 163, per Lord Denning PM.R. at pp 169-170, and per Megaw L.J. at pp 172-173. In differing circumstances, different steps may be needed to bring an exemption clause to a passenger's notice, especially if the clause is an unusual one. In the present case, the only step which the defendant took to bring the exclusive foreign jurisdiction clause to the plaintiff's notice before the fare was paid was the note in the brochure that the conditions of carriage were printed in the (unavailable) Passenger Ticket Contract. In Hollingworth v. Southern Ferries Ltd. (The "Eagle") (1977) 2 Lloyd's Rep 70, it was held that a mere statement in a carrier's brochure that the carrier contracted on its conditions of carriage was not enough to make those conditions terms of a contract of carriage subsequently made with an intending passenger who had read the brochure.

16. The Exchange Order mentions "the Sun Line passage contract" but gives particulars only of Article 2 of that document. It does not bring to the notice of the passenger any exclusive foreign jurisdiction clause. As Dr Fay was unaware of that clause, it did not become incorporated into the contract made when the Exchange Order was issued. In The "Dragon" (at p 262) Brandon J. (as he then was) pointed out that, if the carrier's conditions are not incorporated into the contract of carriage when it is made, the carrier cannot subsequently, "by issuing a ticket containing the conditions concerned, however clearly referred to in it, introduce such conditions into the contract when it was not subject to them originally".

17. As the contract of carriage was made when the Exchange Order was issued and as the exclusive jurisdiction clause contained in cl.13 of the ticket was not then known to Dr Fay and as insufficient was done to bring such a clause to his attention, that clause was not incorporated into the contract of carriage and could not subsequently be incorporated by insertion in the ticket issued pursuant to the original contract. This conclusion differs from the conclusion at which their Honours arrived in the Courts below. It will not, I hope, be thought discourteous if I refrain from analysing the differing reasons advanced by their Honours and merely point out that the two factors which lead me to reject the application to this case of the "conventional analysis" of the ticket cases is that the ticket in this case was issued in performance of an antecedent contract and that, if the ticket were a mere offer, a passenger's election to decline carriage subject to an exemption clause could be exercised only after travelling to Greece and only if the fare were forfeited.

18. This conclusion makes it unnecessary to deal with the Contracts Review Act 1980 (N.S.W.) at this stage of the proceedings. There is no need to invoke the jurisdiction under that Act in order to exclude the operation of the exclusive foreign jurisdiction clause. It is sufficient for the moment to hold that the exclusive foreign jurisdiction clause as printed in cl.13 of the ticket was not incorporated in the contract of carriage and presents no obstacle to the exercise by the Supreme Court of New South Wales of the jurisdiction which the plaintiff has invoked by commencing proceedings for damages.

19. If, contrary to the conclusion I have expressed, the exclusive foreign jurisdiction clause had been a term of the contract of carriage, it would have been necessary to determine whether there were circumstances which warranted a refusal of the stay to which the defendant would have been entitled prima facie: see The Mill Hill, at pp 508-509. It may have been necessary to consider whether there was any reason why the guidelines affecting the exercise of the court's discretion which the Court of Appeal laid down in Aratra Potato Co.Ltd. v. Egyptian Navigation Co. (The "El Amria") (1981) 2 Lloyd's Rep 119 should not be adopted here. Those guidelines have been referred to without dissent in the House of Lords (The "Sennar" (No.2) (1985) 1 Lloyd's Rep 521, at p 527) and they are consistent with the broad approach espoused by Dixon J. in The Mill Hill (at p 509). But, as pointed out by Stephenson L.J. in The "El Amria" (at p 129) cases of a stay to enforce an exclusive foreign jurisdiction clause should not be assimilated to cases where, in England, a stay is sought on the principle forum non conveniens: cf. Amin Rasheed Shipping Corporation v. Kuwait Insurance Co. (1984) AC 50, at p 72; Spiliada Maritime Corporation v. Cansulex Ltd. (1987) 1 AC 460, at p 480. A case where the plaintiff seeks the exercise of a discretion to refuse to give effect to a contractual stipulation that a nominated court should have exclusive jurisdiction requires justification of a different order from that required in a case where the plaintiff has simply chosen to sue in one forum rather than another, both being available to him. However, as the defendant has not established that the exclusive foreign jurisdiction clause set out in cl.13 on the ticket was a term of the contract of carriage, I turn to the alternative ground advanced by the defendant for seeking a stay, namely, that a Greek court is, and the Supreme Court of New South Wales is not, the appropriate forum for deciding the plaintiff's claim.

20. This ground must be approached on a different footing from that adopted by the majority in the Court of Appeal. There it was assumed that the exclusive foreign jurisdiction clause bound the plaintiff but, as he would be deprived of the prospect of relief under the Contracts Review Act if effect were given to the clause, it would be wrong to give effect to it. In my opinion, had the plaintiff been bound by the clause, there would have been no reason why the relief to which the plaintiff was entitled should not have been determined by the Athenian courts. Before a court can refuse to enforce a contractual stipulation in order to allow a plaintiff a right to sue which he has bargained away the court must have substantial grounds prevailing over what Dixon J. in The Mill Hill (at p 509) called "a strong bias in favour of maintaining the special bargain". Moreover, if the exclusive foreign jurisdiction clause had been part of the contract of carriage, Greek law would probably have been held to be the proper law of the contract and the contract would thus have been outside the reach of the Contracts Review Act: see s.17(3)(a). However, as that clause was not part of the contract, there was no contractual stipulation precluding the plaintiff's commencement of the proceedings in the Supreme Court of New South Wales. The defendant therefore bears the onus of showing that it is a proper case for the exercise of a discretion to stay.

17. The conclusion to which I have come in relation to the arguments based on policy is that they are persuasive but not compelling. In my view, they are not sufficiently strong to warrant a decision by this Court to depart from existing principle and authority at least at this stage of the development of the law. If the law of this country is to be changed in that regard, it seems to me to be preferable that it be done by legislation enacted after full inquiry and informed assessment of international as well as domestic considerations of a kind which this Court is not equipped to make of its own initiative (cf. per Black J., dissenting, Gulf Oil Corp. v. Gilbert, at p 517). Such legislation could lay down comprehensive rules and guidelines and could avoid the judicial discretion to stay or dismiss proceedings on inappropriate forum grounds being undesirably unconfined. Accordingly, I would not alter established principle in favour of a judicial adoption of the broader forum non conveniens doctrine.

18. When one turns to the facts of the present case, it is apparent that the effect of adherence to traditional principle is that the appeal must fail. In essence, the appellant's argument is that the proceedings should be brought in the courts of Greece rather than in the Supreme Court of New South Wales. In the context of what has been said above, the answer to that argument is that the Supreme Court of New South Wales cannot properly be seen as a clearly inappropriate forum.

19. Questions of the assessment of the quantum of damages aside, there are three main general issues involved in the proceedings. The first is whether certain actions and transactions resulted in a contract between the respondent and the appellant before the time when the respondent arrived in Greece. The second is what, in the light of the resolution of the first issue, were (i) the terms of the ultimate contract between the appellant and the respondent and, in particular, (ii) the contractual or other effect of the "small print" clauses contained in the ticket which was not made available until about the time when the respondent boarded the appellant's ship in Greece. The third is whether, in the light of the resolution of the first two issues, the appellant is liable to the respondent for damages for the injuries he sustained and, if so, what is the basis on which such damages are to be assessed.

20. The respondent is an Australian who resides in Queensland. All of the transactions and actions relating to the first issue took place in New South Wales. The question whether those transactions and actions resulted in a binding contract between the parties must, in my view, be determined by reference to the law of New South Wales - the locus contractus. The Supreme Court of New South Wales is not only an appropriate, but is the most appropriate, forum for determining that first issue.

21. If, as the material presently before the Court would seem to me to indicate, the actions and transactions in New South Wales resulted in a binding contract between the respondent and the appellant before the respondent left Australia, the Supreme Court of New South Wales and the Greek courts would have competing claims to be considered as the most appropriate forum to determine the second general issue (i.e. the identification of the terms of the contract and of the contractual or other effect (if any) of the "small print" clauses in the passenger ticket). Clearly, the Greek courts would be the most appropriate forum for determining the third general issue, namely, liability for damages (in the context of the relevant contract) for the injuries which the plaintiff sustained on a Greek ship in Greek waters between Turkish and Greek ports. If the case reaches an assessment of the quantum of the damages to which the respondent is entitled, both the Supreme Court of New South Wales and the Greek courts would have competing claims to be considered the most appropriate forum.

22. In these circumstances, there is much to be said for the view that the more appropriate forum for the hearing of the overall action would be a tribunal in Greece. I doubt, however, that the appellant has established that that view is clearly correct. Be that as it may, it seems to me to be plain that it could not properly be said that the Supreme Court of New South Wales is, in all the circumstances, a clearly inappropriate forum. In that regard, the present case provides a good illustration of the greater uncertainty about whether an action should be dismissed or stayed on inappropriate forum grounds, with the added likelihood of litigation about where to litigate, which would be a consequence of the substitution of a broader forum non conveniens discretion for the existing discretion under traditional principle.

23. There are three further matters of which I would make brief mention. The first is that it was submitted on behalf of the appellant that the contract between itself and the respondent contained a clause submitting any dispute between the respondent and itself to the exclusive jurisdiction of the courts of Athens. I find it unnecessary to consider what the effect of such a clause would be in the circumstances of the present case since the view which I have formed, on the material at present before the Court, is that the only contract between the appellant and the respondent was concluded in New South Wales and contained no such clause. In that regard, I am in general agreement with the reasons of Wilson and Toohey JJ.

24. The second further matter is that I have found it unnecessary, for the purposes of the present case, to consider whether the principles governing an application for dismissal or a stay on inappropriate forum grounds are applicable to an application for leave to serve process outside territorial jurisdiction or for leave to proceed in a case where process has been so served. In the case of an application for leave to serve or proceed, the jurisdiction invoked is statutory and not inherent and a refusal of the application involves an exercise of the relevant jurisdiction to determine the application for leave to serve or to proceed rather than a refusal to exercise jurisdiction which has been regularly invoked.

25. The final further matter to which I would make brief reference is a matter of some general importance in principle. It is that it should be apparent from what has been said above that it seems to me that an adoption by this Court of a broader forum non conveniens doctrine would represent a change of the law based not on considerations of principle but on grounds of policy. That being so, I can see force in the view that, if this Court were to adopt a broader forum non conveniens doctrine for policy reasons, the adoption of that doctrine should be prospective only and inapplicable to actions which had already been commenced in a local court and which could not properly be stayed on the ground that the local court is a clearly inappropriate forum. That matter was not however argued by the parties in the present case and it is unnecessary that I pursue it.

26. The appeal should be dismissed.

GAUDRON J: Dr Fay, ("the respondent") is a resident of Queensland. In early 1983, Dr Fay and his wife made a booking through a New South Wales agent for a cruise of the Greek Islands aboard the M.S. Stella Oceanis. Before paying for the cruise, the respondent was shown a brochure outlining details of Sun Line cruises. The "small print" at the back of the brochure provided, (inter alia) under the heading "Things to Know Before You Go", that "the transportation of passengers ... is governed by the terms and conditions printed on the Passenger Ticket Contract which may be inspected at any Sun Line office." The respondent gave evidence that he did not read the body of the brochure and, in particular, did not read this condition.

2. The booking was made through the Sydney office of J.M.A. Tours, an enterprise authorized to accept bookings on behalf of Oceanic Sun Line Special Shipping Company Inc. ("the appellant"), the owner of the Stella Oceanis. Notwithstanding the "small print" at the back of the brochure, J.M.A. Tours did not, as events transpired, have a Passenger Ticket Contract (or any documentation of the terms thereof) available for inspection.

3. The Stella Oceanis is a Greek registered ship. The appellant company is incorporated in Greece, but is a subsidiary of Marriott Corporation, which is incorporated in the United States of America. The fare for the cruise was calculated in U.S. dollars.

4. Upon payment of the fare, J.M.A. Tours issued an Exchange Order in the names of the respondent and Mrs F. Fay. The Order specified (inter alia) the name of the vessel, the sailing date and time, the journey (Piraeus to Piraeus) and the allotted cabin. The Order contained a statement as follows:

"CANCELLATION OF CRUISES OR ALTERATION OF ITINERARY Article 2 of the Sun Line passage contract specifies that in the event of the passenger cancelling his passage or not using it for the sailing for which it was issued, passage money will NOT be refunded. ONLY IF space released is resold will the passage money be refunded. Sun Line reserves the right to cancel any cruise, in which case the passage money will be refunded. Sun Line also reserves the right to alter the itinerary of any cruise if this should become necessary or desirable for any reason. Times of arrival and departure at the various ports of call are given as a general guide, but no guarantee can be given that they will be adhered to. This order will be exchanged for a Sun Line ticket when boarding vessel."

5. In Athens, the Order was exchanged for a passenger ticket, which was written in English, and which, in cl.12, specified various exemptions from liability and limited recovery for any claim (including bodily injury) to $U.S.5000.00. Clause 13 of the ticket provided that any action against the appellant "must be brought only before the courts of Athens Greece to the jurisdiction of which the Passenger submits himself formally excluding the jurisdiction of all and other court or courts ...".

6. During the course of the voyage the respondent was injured. After his return to Australia he obtained medical treatment in New South Wales. He now seeks to recover damages for his injuries in an action in negligence commenced in the Supreme Court of New South Wales. The jurisdiction of the court to entertain the action derives from Pt 10, r.1(e) of the Supreme Court Rules (N.S.W.) which (subject to Pt 10, r.2) then permitted service of originating process outside the State "where the proceedings are founded on, or are for the recovery of, damage suffered wholly or partly in the State caused by a tortious act or omission wherever occurring." The respondent obtained leave to effect service pursuant to Pt 10, r.2.

7. After service the appellant made application (inter alia) that the proceedings be stayed. That application was refused by Yeldham J. An appeal to the Court of Appeal was, by majority, dismissed (Glass and McHugh JJ.A., Kirby P. dissenting). The appellant now invites this Court, on appeal, to adopt the doctrine of forum non conveniens as enunciated in Spiliada Maritime Corporation v. Cansulex Ltd. (1987) 1 AC 460. Alternatively, the appellant argues that the respondent was contractually bound to submit to the exclusive jurisdiction of the Athenian courts, and that this Court should respect that submission.

8. A foreign jurisdiction clause in a contract does not operate to exclude the forum court's jurisdiction, but may constitute a ground for that court to refuse to exercise that jurisdiction: The Fehmarn (1958) 1 W.L.R. 159; (1958) 1 All E.R. 333. Where there is an agreement to submit to another jurisdiction, the power to grant a stay rests on the principle that the courts will, except where the plaintiff adduces strong reasons against doing so, require the parties to abide by their agreement. As Dixon J. observed in Huddart Parker Ltd. v. The Ship Mill Hill (1950) 81 CLR 502, at pp 508-509, "the Courts begin with the fact that there is a special contract between the parties to refer, and therefore in the language of Lord Moulton in Bristol Corporation v. John Aird &Co. ((1913) AC 241, at p 259), consider the circumstances of a case with a strong bias in favour of maintaining the special bargain or as Scrutton LJ. said in Metropolitan Tunnel and Public Works Ltd. v. London Electric Railway Co. ((1926)(Ch 371, at p 389), 'a guiding principle on one side and a very natural and proper one, is that parties who have made a contract should keep it.' " See also The Makefjell (1976) 2 Lloyd's Rep 29; The Kislovodsk (1980) 1 Lloyd's Rep. 183 and The El Amria (1981) 2 Lloyd's Rep 119, at p 122. However, this presumption does not, as Dixon J. went on to observe in The Mill Hill at p 509 (referring to Aird, at p 260 and Metropolitan Tunnel, at pp 389-390) restrict the circumstances which will warrant a refusal of a stay.

9. The principles applicable to the exercise of the discretion to grant a stay on the basis of submission to another jurisdiction render it necessary to consider whether the contract concluded between the appellant and the respondent included the choice of jurisdiction clause in the passenger ticket. A preliminary question arises: by what law is the existence of that term to be decided?

10. In general terms, the rights and obligations of parties to a contract are to be ascertained in accordance with the proper law of the contract, viz., the law which the parties intended to govern their contractual relationship, or, in the absence of agreement, the law with which the transaction has its closest connection: Bonython v. Commonwealth of Australia (1951) AC 201, at p 219. A foreign jurisdiction clause may, but does not necessarily, indicate an intention that the contractual rights and obligations of the parties should be governed by the law of the agreed jurisdiction: Compagnie d'Armement Maritime S.A. v. Compagnie Tunisienne de Navigation S.A. (1971) AC 572, at p 609. In the context of this appeal, the question whether the appellant and respondent agreed in terms of cl.13 is primarily relevant to the issue of whether a stay should be granted. However, it may also be relevant, in the context of the broader issues between the parties, to the ascertainment of the proper law of their contract, should that need to be decided. If the question whether the parties intended to be bound by cl.13 were to be asked in the course of ascertaining the proper law of the contract, it would in my view fall for answer in accordance with the lex fori, although this is not a matter which appears to have been authoritatively decided.

11. In Compagnie d'Armement Maritime S.A. Lord Diplock (at p 603) distinguished between "the first and second stage in the ascertainment of the proper law of the contract", saying

"The first stage ... when any question arises

between parties to a contract as to the proper law applicable to it, is to determine whether the parties intended by their contract to exercise any choice at all and, if they did, to determine what was the system of law which they selected. In determining this the English court applies the ordinary rules of English law relating to the construction of contracts. If, applying these rules, the court reaches the conclusion that the parties did not intend to exercise any choice of proper law, or is unable to identify what their choice was, it becomes necessary for the court to proceed to the second stage, of determining itself what is the proper law applicable. In doing so, the court applies the English rule of the conflict of laws relating to the proper law of the contract." (emphasis added)

Later, at p 605, his Lordship said:

"... the application of a positive rule of English law as determinative of the proper law of a contract does not arise until the second stage, that is, when the court has been driven to the conclusion that the parties themselves did not intend to exercise any choice of proper law or is unable to identify what their choice was."

12. The above statements support the proposition that the lex fori determines (inter alia) questions as to the existence, construction and validity of terms bearing upon determination of the parties' agreement as to the proper law. Indeed I think that must be so. If the question of what is the proper law is one to be answered by application of the lex fori, until the lex fori provides the answer to that question there is no scope for the operation of any other law. In other words, all questions which are necessarily antecedent to a determination of the proper law of a contract must fall for answer in accordance with the lex fori. See also Mackender v. Feldia A.G. (1967) 2 QB 590, at p 603; Cheshire and North, Private International Law, 11th ed. (1987), p 477.

13. As there is a "strong bias" in favour of granting a stay of proceedings in the event that there has been a submission to the exclusive jurisdiction of a foreign forum, it may well be that in some proceedings for a stay it is unnecessary to embark upon an inquiry as to the "proper law" of the contract, even though the contract contains a foreign jurisdiction clause. Accordingly, it seems to me to invite unnecessary complexity in proceedings for a stay based on the parties' submission to a foreign jurisdiction to allow questions as to the existence, construction or validity of a foreign jurisdiction clause to be determined by application of any law other than the lex fori. However, as, in my view, it is the lex fori which provides the answer to the same question when asked in the process of determining the proper law, it follows that it must also provide the answer when it is necessary to determine whether or not a stay should be granted on the basis of submission to a foreign jurisdiction.

14. The principles of New South Wales law relevant to a determination of whether the appellant and respondent agreed in terms of cl.13 of the passenger ticket are set out in the judgment of Brennan J. I respectfully adopt his Honour's statement of applicable principle and his Honour's conclusion that the foreign jurisdiction clause was not incorporated in the contract of carriage between the appellant and the respondent. It follows that the appellant is not entitled to call in aid of a stay the "strong bias" acknowledged in The Mill Hill. I now turn to consider whether this Court should adopt the doctrine of forum non conveniens as enunciated in Spiliada.

15. The decision of the House of Lords in Spiliada is the latest significant step in the formulation of the rules to be applied in determining whether an action brought in English courts should be stayed on the ground that the action may be litigated in another available forum which has competent jurisdiction if that alternative forum is the "appropriate" forum for the trial of the action: that is, as expressed by Lord Keith of Kinkel in The Abidin Daver (1984) A.C. 394, at p 415, if it is "the natural forum", being "that with which the action had the most real and substantial connection." The appropriate forum is to be determined by the balancing of "connecting factors", of which a legitimate personal or juridical advantage accruing to a plaintiff by reason of the choice of forum is not decisive: Spiliada, at pp 478 and 482. See also de Dampierre v. de Dampierre (1988) 1 AC 92, at pp 109-110.

16. The decision in Spiliada was a clear departure, albeit one which evolved through a number of cases, from the earlier rule which finds its clearest expression in St. Pierre v. South American Stores (Gath and Chaves) Ltd. (1936) 1 KB 382, at p 398 (per Scott L.J.) as follows:

"(1.) A mere balance of convenience is not a sufficient ground for depriving a plaintiff of the advantages of prosecuting his action in an English Court if it is otherwise properly brought. The right of access to the King's Court must not be lightly refused. (2.) In order to justify a stay two conditions must be satisfied, one positive and the other negative: (a) the defendant must satisfy the Court that the continuance of the action would work an injustice because it would be oppressive or vexatious to him or would be an abuse of the process of the Court in some other way; and (b) the stay must not cause an injustice to the plaintiff. On both the burden of proof is on the defendant."

17. The principle enunciated in St. Pierre had earlier been accepted by this Court in Maritime Insurance Co. Ltd. v. Geelong Harbor Trust Commissioners (1908) 6 CLR 194, a decision later applied by Gibbs J. in the Supreme Court of the Australian Capital Territory in Cope Allman (Australia) Ltd. v. Celermajer (1968) 11 FLR 488, at p 492. It was not suggested that the application of that principle as currently understood would, in the instant matter, entitle the appellant to a stay of proceedings.

18. The concept of forum non conveniens is one firmly entrenched in the jurisprudence of other legal systems, for example, those of Scotland and the United States. The adoption of a similar doctrine in England is very recent. All evolutionary change in common law is explicable by reference to underlying developments in the law or in society. The origin of the doctrine ultimately adopted in Spiliada is to be found in The Atlantic Star (1974) A.C. 436, where Lord Reid (at p 453) based his re-examination of what he described as "the rather insular doctrine" as the need "to try, so far as possible, to keep the development of the common law in line with the policy of Parliament and the movement of public opinion." Our legal heritage is the gift of the common law of England, and our legal system necessarily has much in common with that of England. Where, however, developments in the common law of England reflect underlying changes which may not be matched in Australian law or society, care must be exercised in determining the extent to which changes in the English common law should be reflected in the common law of this country. For example, expressions of preference in England for "judicial comity" rather than "judicial chauvinism" (as in The Abidin Daver, at p 411) are readily understandable when it is borne in mind that England is a member of the European Community, which is not merely an alliance of similarly minded sovereign nation states, but a community with its own parliament, its own laws and its own court. Indeed, the European court has said that member states "have limited their sovereign rights, albeit within limited fields": van Gend en Loos v. Nederlandse Tariefcommissie (1963) 2 CMLR 105, at p 129.

19. Although the decisions which have marked the development and acceptance in England of the doctrine of forum non conveniens have proceeded on the basis that it is a separate principle of law, it is not, I think, without significance that acceptance of the doctrine followed changes in the choice of law rules applicable in matters of private international law. The decision in Chaplin v. Boys (1971) AC 356 has resulted in a situation in which liability for a foreign tort may be determined by application of foreign law. Although the English common law has long recognized that contractual rights and obligations may fall for determination by the application of foreign law as the proper law of the contract, the role of the proper law has undergone considerable change. In Amin Rasheed Shipping Corporation v. Kuwait Insurance Co. (1984) AC 50, Lord Diplock (at p 61) described the proper law of a contract as "the system of law by reference to which (the parties') mutual rights and obligations under it are to be ascertained." Lord Wilberforce (at p 69) said it was "the law which governs the contract and the parties' obligations under it; the law which determines (normally) its validity and legality, its construction and effect, and the conditions of its discharge." Those statements allow little scope for the operation of English law as either the lex fori or the lex loci contractus. The position appears to have been different, at least in relation to the lex loci contractus, at the time of the decision in Chatenay v. The Brazilian Submarine Telegraph Company, Limited (1891) 1 QB 79, when it was said by Lord Esher M.R. (at pp 82-83) that:

"if a contract is made in a country to be executed in that country, unless there appears something to the contrary, you take it that the parties must have intended that that contract, as to its construction, and as to its effect, and the mode of carrying it out (which really are the result of its construction), is to be construed according to the law of the country where it was made. But the business sense of all business men has come to this conclusion, that if a contract is made in one country to be carried out between the parties in another country, either in whole or in part, unless there appears something to the contrary, it is to be concluded that the parties must have intended that it should be carried out according to the law of that other country."

Given the developments which have taken place in England in relation to choice of law rules, it is not difficult to envisage that in many cases involving an international aspect brought in English courts, the rights and obligations of the litigants may fall for determination by the application of foreign law, English law merely providing the procedural framework within which the rights and liabilities are to be determined.

20. The question of stay of proceedings in cases in which the forum will merely provide the procedural framework for the application of foreign substantive law raises, I think, an issue not satisfactorily resolved by application of the test enunciated in St. Pierre, at least as that test has been understood to date. In such cases the selected forum will have no real interest in the substantive laws to be applied, and prima facie it would seem that the interests of justice might be better served by adjudication in the forum of the country whose substantive laws will be determinative of the rights and liabilities of the parties. Moreover, there may be cases where the forum has been selected because of some advantage the plaintiff may obtain by virtue of the procedural laws of that forum, but there is otherwise no (or insufficient) connection between the plaintiff and that forum to vest in the plaintiff any reason to expect that the advantage sought should be available to him or her. Such matters seem to me to warrant either a more liberal approach to the principles enunciated in St. Pierre, or acknowledgment that considerations of convenience ought to be taken into account in determining whether a stay should be granted in cases where the rights and liabilities of the parties must be determined by the application of foreign substantive law, the forum law merely providing the procedural framework for the application of that foreign law. However, the forum non conveniens doctrine enunicated in Spiliada goes further, Lord Goff of Chieveley allowing (at p 481) that "the fact that English law is the putative proper law of the contract may be of very great importance ... or it may be of little importance as seen in the context of the whole case."

21. A doctrine which confers upon a court a discretion to decline to exercise its regularly invoked jurisdiction and thereby decline to participate in the application of its own substantive law (whether by the operation of its choice of law rules or directly of its own force) raises fundamental problems. The principles enunciated in St. Pierre, and those applicable to foreign jurisdiction clauses, already permit of that possibility: the former operating upon considerations of justice, and the latter, by reason of the agreement of the parties. However, I do not think that possibility should be extended, whether by adoption of the doctrine as enunciated in Spiliada or by reformulation of existing principle. The primary obligation of the courts of this country is to the laws of this country. That obligation, in my view, requires that any new principle or any reformulation of existing principle should be confined to cases where the rights and liabilities of parties to the litigation must, by reason of applicable choice of law rules, be determined by the application of the substantive law of a foreign legal system, the forum law merely providing the procedural framework for the action.

22. It may be objected that to deny an extension of power to the courts to stay proceedings capable of being adjudicated in a more appropriate forum, other than in respect of matters which fall for determination by the application of the substantive law of a foreign country, is to allow the possibility that the courts of this country will be obliged to determine matters which have little connection with this country. I think such a possibility is more theoretical than real, but more importantly, the possibility arises, not so much from the principles applicable to the grant of a stay, but from the rules (both common law and statutory) as to justiciability, and the common law rules governing choice of law.

23. Where the rights and liabilities of parties fall entirely for determination by the application of foreign substantive law the selected forum will on occasions be an inappropriate forum in the sense explained in the judgment of Deane J. in this case. Arguably the selected forum may be inappropriate, notwithstanding that the defendant is domiciled, resident or carries on business within the jurisdiction, particularly if the defendant is also amenable to the jurisdiction of a forum of the country whose laws govern the matter in issue and that country is the country with which the matter in issue has its closest connection. It seems to me that there is likely to be little, if any, practical difference in cases falling entirely for determination by the application of foreign substantive law whether the question of stay is determined on the basis of the selected forum being an inappropriate forum in the sense explained by Deane J., or whether it is determined on the basis that there is another available, and more appropriate, forum as allowed in Spiliada. For present purposes it is sufficient if, subject to one matter hereafter to be mentioned, I state my preference for the inappropriate forum test as stated by Deane J. That test is consonant with established principle, and gives the approach enunciated in St. Pierre an operation attuned to modern circumstances.

24. Acceptance that a stay may be granted in cases not involving the application of the substantive law of the forum if the forum is inappropriate in the sense explained by Deane J. does not, in my view, mean that proceedings for a stay require, or should in every case provide an opportunity for, determination of the question of applicable law. It seems to me undesirable for litigation as to where litigation should take place to be complicated by considerations of applicable law, particularly if those considerations may involve the determination, whether provisionally or otherwise, of questions of fact or law which trench upon the ultimate question of liability or the extent thereof. Accordingly, in my view, the selected forum should not be seen as an inappropriate forum if it is fairly arguable that the substantive law of the forum is applicable in the determination of the rights and liabilities (including the extent of liability) of the parties.

25. In the present case it is fairly arguable that the substantive law of New South Wales is applicable in the determination of the rights and liabilities of the parties. Leaving aside the question of applicable law as to the determination of tortious liability (as to which see Koop v. Bebb (1951) 84 CLR 629; Anderson v. Eric Anderson Radio &T.V. Pty. Ltd. (1965) 114 CLR 20 and Pozniak v. Smith (1982) 151 CLR 38) it seems to me that the question whether the parties have agreed upon limitation of liability in accordance with cl.12 of the passenger ticket may fall for decision by application of the law of New South Wales, whether or not the law of New South Wales is the proper law of the contract. At this stage it suffices to say that, in my view, questions as to the formation of contract, including questions as to the existence of a contract or its terms, and questions as to validity, are not necessarily or invariably to be decided by the proper law, or what would be the proper law if a contract had come into existence. See Kay's Leasing Corporation Pty. Ltd. v. Fletcher (1964) 116 CLR 124, per Kitto J., at p 143 and Libling, "Formation of International Contracts" (1979) 42 Modern Law Review 169.

Orders

Appeal dismissed with costs.