PURVIS -v- SAKARI RESOURCES LTD
[2015] WASC 63
•19 FEBRUARY 2015
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: PURVIS -v- SAKARI RESOURCES LTD [2015] WASC 63
CORAM: MASTER SANDERSON
HEARD: 27 JANUARY 2015
DELIVERED : 19 FEBRUARY 2015
FILE NO/S: CIV 2372 of 2014
BETWEEN: MARTIN DAVID PURVIS
Plaintiff
AND
SAKARI RESOURCES LTD
Defendant
Catchwords:
Practice and procedure - Application to stay proceedings when action commenced in Singapore - Turns on own facts
Legislation:
Nil
Result:
Application refused
Category: B
Representation:
Counsel:
Plaintiff: Mr H J Dixon SC & Mr A Gotting
Defendant: Mr S K Dharmananda SC & Mr E M Heenan
Solicitors:
Plaintiff: Ashurst Australia
Defendant: MKI Legal
Case(s) referred to in judgment(s):
Henry v Henry [1996] HCA 51; (1996) 185 CLR 571
Pilbara Iron Ore Pty Ltd v Ammon [2008] WASCA 202
Regie Nationale des Usines Renault SA v Zhang [2002] HCA 10; (2002) 210 CLR 491
Singh v Singh [2009] WASCA 53
Sterling Pharmaceuticals Pty Ltd v The Boots Company (Australia) Pty Ltd [1992] FCA 72; (1992) 34 FCR 287
Voth v Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538
MASTER SANDERSON: By this application the defendant seeks an order that the proceedings be permanently stayed on the ground that the Supreme Court of Western Australia is a clearly inappropriate forum for the determination of the proceeding as its continuation would be oppressive or vexatious to the defendant. As an alternative the defendant seeks that the proceedings be stayed temporarily pending the outcome of a related proceeding in the High Court of the Republic of Singapore. In fact as the matter was argued it was this latter alternative which was pressed. Be that as it may the application was framed in the alternative and these reasons deal with both applications.
The plaintiff commenced these proceedings on 30 September 2014. A statement of claim was lodged on that same date. In the statement of claim the plaintiff pleads the defendant is a company incorporated in Singapore. At all material times one Chitrapongse Kwangsukstith was its Chairman. A Mr Timothy Glare was General Manager - Human Resources of the defendant and Mr Graeme Tivey was the Company Secretary.
Pursuant to an employment agreement made on or about 7 October 2010 the plaintiff was engaged by the defendant as its Managing Director. The employment agreement is pleaded in some detail. Relevantly the plaintiff pleads if his employment was terminated he was entitled to certain payments which in the pleading are referred to as the 'Termination Payment'. The plaintiff says his employment was terminated and he became entitled to a Termination Payment of $3,831,449. Subsequent to the termination and on 9 September 2013 the defendant paid the plaintiff an amount of $2,648,288.81 which the plaintiff said was part of the Termination Payment and which he defines in the agreement as the 'Actual Payment'. In the same month the defendant notified the plaintiff that it was withholding $1,223,191.72 in respect of anticipated taxation relating to the Termination Payment. The plaintiff pleads in October 2013 the Inland Revenue Authority of Singapore notified the defendant an amount of $651,982.66 was payable in respect of the Termination Payment. The plaintiff says he is entitled to the Termination Payment less the taxation liability. When converted into Australian dollars this amounts to $554,454.17. The plaintiff claims that amount as his entitlement and he wants to be paid.
On the face of it then this is a straightforward breach of contract claim. In fact there are four additional paragraphs of the statement of claim (pars 37 ‑ 41) which hint at what the defence to the claim might be. During the course of submissions I put to counsel the inclusion of these paragraphs really anticipated a defence and amount to poor pleading practice. Counsel accepted that was the case. But the fact a defence is anticipated in the pleading does not render the claim itself anything other than a straightforward and relatively simple.
The defendant entered a conditional appearance on 13 October 2014. On 27 October 2014 it took out the present summons seeking to have this action stayed. It would not appear as though the summons was taken out pursuant to O 12 r 6(2) of the Rules of the Supreme Court 1971 (WA). So the appearance has become unconditional. The defendant is not contending 'on the ground of any informality or irregularity' the service of the process is invalid.
On 14 October 2014 (the day after it lodged the conditional appearance in these proceedings) the defendant issued proceedings in the High Court in Singapore. The present plaintiff was named as a defendant in those proceedings along with Mr Glare and Mr Tivey. A statement of claim was annexed to the writ. These documents appear as attachment HEJ2 to an affidavit of Han Eng Juan sworn 9 December 2014 and filed in support of this application. The statement of claim pleads separately against all three defendants. (In an attempt to avoid confusion I will refer to the parties when referring to the Singapore High Court proceedings. Just to clarify the position Sakari Resources Ltd is the plaintiff in the proceedings, Mr Purvis is the first defendant, Mr Glare is the second defendant and Mr Tivey is the third defendant.)
Sakari pleads as against the first defendant the employment contract referred to by Mr Purvis in his statement of claim describing that agreement as 'the Executive Service Agreement'. Sakari pleads as against Mr Glare he was General Manager - Human Resources until his employment was terminated on 28 April 2014. As against Mr Tivey, Sakari pleads he was Sakari's Company Secretary until his employment was terminated on 9 September 2014. In other words there is no dispute between the parties as to the positions within Sakari held by the Mr Purvis, Mr Glare and Mr Tivey.
What Sakari alleges is Mr Purvis was paid unauthorised severance payments and these payments were made with the assistance of Mr Glare and Mr Tivey and without the requisite approval of the Sakari Board. The statement of claim in the Singapore proceedings is lengthy. In this court it would be open to criticism on the basis it pleads evidence. It reads very much like counsel's opening address. But it must be said it does set out in some detail the chain of events which is said to have occurred referring to relevant documents along the way.
This leads eventually to par 32 of the statement of claim which is in the following terms:
The Plaintiff avers that the 1st Defendant [Mr Purvis] is not entitled to the Unauthorized Severance Payments because the 1st Defendant's employ was not terminated pursuant to Clause 15.3 of the Executive Service Agreement, but had expired at the end of the Initial Term on 31 August 2013 due to the Plaintiff's decision not to reappoint the 1st Defendant. The Plaintiff avers that the 1st Defendant was well aware of this by virtue of the Plaintiff's letters to him dated 28 February 2013 and 29 July 2013.
There is an alternative plea in par 33 which amounts to an allegation that if Mr Purvis was entitled to the 'Unauthorized Severance Payments' he was aware such payments required the approval of Sakari's Board, that such approval had not been obtained and that payment could not be made until the approval was obtained.
Paragraphs 34 ‑ 40 of the statement of claim detail events which occurred after the payments had been made to Mr Purvis. Paragraphs 41 ‑ 44 deal with the tax matters. There would appear to be no difference on the facts between the matters pleaded in this court and the matters pleaded in the Singapore proceedings. What does appear to be common ground is the difference between what was retained by Sakari and what was paid to the Singapore tax authorities has not been paid to Mr Purvis.
Paragraphs 45 ‑ 52 appear under the heading 'The 1st Defendant's Duties and Breaches'. Reference is made to the contractual obligations of Mr Purvis under the terms of his contract. It is then alleged Mr Purvis owed fiduciary duties to Sakari and certain further equitable duties. It is said the duties owed were breached and extensive particulars of the alleged breaches are provided. Finally it is alleged Mr Purvis 'engaged in a dishonest and fraudulent design by acting in breach of his duties and/or the terms of his contract of employment and/or trust'.
Similar duties and breaches are alleged against Mr Glare and Mr Tivey. It is unnecessary to go through the pleading in detail. What can be said is that Sakari alleges both Mr Glare and Mr Tivey owed duties to Sakari which were similar to those allegedly owed by Mr Purvis, these duties were breached and as a consequence Sakari has suffered loss and damage.
Stripped back to its essentials the claim made by Sakari in the Singapore proceedings really amounts to this. Mr Purvis had an employment contract with Sakari. Sakari decided not to renew that contract. Under the terms of the contract Mr Purvis did not have an entitlement to any or any significant Termination Payment. Nonetheless the three men in breach of their contracts with the plaintiff and in breach of duties they owed to the plaintiff determined Mr Purvis should be paid a Termination Payment and actually arranged for that payment to be made. As an alternative if Mr Purvis was entitled to the Termination Payment such payment was subject to Board approval. All three men knew that to be the case and knowing approval had not been obtained nonetheless went ahead and facilitated the payment.
During the course of his submissions counsel for the defendant maintained the action in Singapore was much broader in scope than the action in this court. With respect that argument seems to me to be unfounded. The plaintiff in his statement of claim has pleaded his contract of employment and his alleged entitlement to the Termination Payment. That is all he needed to do. Of course he could see what was coming - that was why additional matters which anticipated a defence were included in the statement of claim. In the normal course what the defendant would have done was put on a defence which pleaded material facts and alleged the plaintiff was not entitled to any further payment. Doubtless the defendant would then have made a counterclaim seeking to recover amounts already paid to the plaintiff which the defendant alleges he was not entitled to. Given the defendant effectively alleges a conspiracy it would probably have joined Mr Glare and Mr Tivey as parties to the counterclaim.
In the Singapore proceedings Mr Purvis and Mr Glare have entered an appearance but have not consented to jurisdiction. It appears Singapore has a different system to ours when there is a challenge to jurisdiction. There is no conditional appearance procedure - an appearance is entered and the question of jurisdiction is considered as part of the action as a whole. So the court in Singapore might determine the action against Mr Purvis and Mr Glare ought not proceed. Mr Tivey is in a different position. He has not challenged the jurisdiction of the Singapore court and he has filed a defence and counterclaim. This is a point of some importance in the context of this case.
While there was some difference in emphasis between the parties in relation to the legal principles there was a large measure of agreement. In written submissions counsel for the defendant put the position as follows:
The legal principles are well established. Consideration of whether to grant a stay on the ground that the local court is a clearly inappropriate forum involves a 'subjective balancing process'. That is, the exercise is discretionary. It is a process of assessing whether there are enough factors indicating that the forum is clearly inappropriate (in which case a stay should be granted), not one of weighing those factors that point towards a stay against those that point away from a stay. Ultimately, a subjective evaluation is required.
Where there are related proceedings pending in a foreign court arising out of the same sub‑stratum of fact, but in which different issues arise and which may involve different parties, the question is not whether the Australian court is a clearly inappropriate forum for the litigation of the issues involved in the Australian proceedings but rather whether, having regard to the controversy as a whole, the Australian proceedings are oppressive in the sense that they are 'productive of serious and unjustified trouble and harassment' or 'seriously and unfairly burdensome, prejudicial or damaging'. That assessment may take into account numerous factors, including the nature and status of the proceedings in the foreign Court. (footnotes omitted)
Counsel for the plaintiff made two particular points. First, a court will focus on the inappropriateness of the forum court and not upon the appropriateness or comparative appropriateness of another court. Further, a court is not a clearly inappropriate forum merely because an alternative court is considered more appropriate.
The parties cited a large number of authorities, the most important of which are Voth v Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538; Henry v Henry [1996] HCA 51; (1996) 185 CLR 571; Regie Nationale des Usines Renault SA v Zhang [2002] HCA 10; (2002) 210 CLR 491; and in this jurisdiction Singh v Singh [2009] WASCA 53. From these and other cases I think the following points emerge.
First, a court will consider a range of connecting factors in deciding whether a court is a clearly inappropriate forum including the domicile and residency of the parties, the subject matter of the suit, the place where the transactions occurred, the location of the evidence and the presence or absence of an alternative forum. Second, the court will consider as a material factor whether the proper law is that of the forum. Third, a court will not weigh or balance all of the factors but rather assess whether there are sufficient factors indicating that the forum is clearly inappropriate. Fourth, the onus lies on the defendant to satisfy the court that the court is a clearly inappropriate forum. Finally, the stay of proceedings on the grounds of forum non conveniens is only made in a clear case.
The plaintiff says he has a number of connecting factors with this State. In par 19 of written submissions these are listed as follows:
(a)the Plaintiff is resident in this State (see Plaintiff Affidavit at paragraphs 4, 5, 53 and 54);
(b)the Plaintiff owns assets in this State (see Plaintiff Affidavit at paragraphs 5, 6 and 8);
(c)the solicitors of the Plaintiff practice in this State (see Plaintiff Affidavit at paragraph 16);
(d)the Plaintiff has his documents in this State (see Plaintiff Affidavit at paragraph 11);
(e)the Plaintiff has a bank account in this State (see Plaintiff Affidavit at paragraphs 32, 38, 39, 83 and 101);
(f)the Actual Payment (monies subject to dispute in these proceedings) is located in this State (see Plaintiff Affidavit at paragraphs 83, 101 and 102); and
(g)apart from one bank account in Singapore (see Han Reply Affidavit at paragraph at 11) (which the Plaintiff instructs was established for the purposes of an executive share acquisition plan established and administered by the Defendant), the Plaintiff does not have any assets in Singapore (see Plaintiff Affidavit at paragraphs 12 and 15).
The plaintiff says further he has a number of personal advantages associated with the proceedings continuing in this court. Referring once again to the written submissions he lists these as follows (par 20):
(a)the Plaintiff will save or avoid costs and expenses in continuing the proceedings in this Court rather than litigating in a court in Singapore (including costs of instructing foreign solicitors, of travelling to and from Singapore and for meeting the expenses of his witnesses to travel to and from Singapore);
(b)the Plaintiff will be able to secure the attendance of Mr Tim Glare in proceedings in this Court (as Mr Glare is resident in the State (see Plaintiff Affidavit at paragraph 108) and may be served with a subpoena to secure his attendance); and
(c)the Plaintiff will be able to secure the attendance of Mr Graeme Tivey in proceedings in this Court (as Mr Tivey is resident in Victoria (see Plaintiff Affidavit at paragraphs 108 and 113) and may be served with a subpoena to secure his attendance (see section 29 of the Service and Execution of Process Act 1992 (Cth)).
The plaintiff says the proper law of the contract is Western Australian law for the following reasons (par 22):
(a)the contract was signed by the Plaintiff in this State (see Plaintiff Affidavit at paragraphs 19, 20 and 24);
(b)the contract was signed by a representative of the Defendant in this State (see Plaintiff Affidavit at paragraph 23);
(c)the Plaintiff was a resident of this State when making the contract (see Plaintiff Affidavit at paragraphs 4 and 20);
(d)the contract provided that the 'point of hire' was Perth (see clause 4.3 of the contract);
(e)the contract provided that the Plaintiff would be required to travel on a regular and extended basis, including to Singapore, and the Defendant would provide accommodation during such travel (see clause 4.3 of the contract);
(f)the contract specified the amount of salary in Australian dollars (see item 1 of Schedule 1to the contract);
(g)the contract addressed increases in salary by reference to the 'All Groups Consumer Price Index for Perth published by the Australian Bureau of Statistics' (see clause 5.3(d) of the contract);
(h)the contract provided for the making of superannuation contributions by reference to the 'minimum statutory levels' (see clause 6 of the contract), with the minimum statutory levels appearing in the Superannuation Guarantee (Administration) Act 1992 (Cth);
(i)the contract addressed the payment of fringe benefits tax (see clause 7.3 of the contract), a tax imposed by the Fringe Benefits Tax Assessment Act 1986 (Cth);
(j)the contract provided for four weeks annual leave (see clause 9 of the contract), commensurate with the level prescribed in section 87 of the Fair Work Act 2009 (Cth); and
(k)the contract referred to the Corporations Act 2001 (Cth) (see clause 1.1 'Corporations Act', clause 1.2(k) and clause 16.4 of the contract).
There was some discussion between the parties as to who would be the witness called at any trial and where those witnesses might come from. The plaintiff conceded if the action proceeded in Western Australia the defendant's main witness Dr Kwangsukstith and at least five other individuals would need to come from Thailand. The plaintiff and Mr Glare are resident in Western Australia. It is not entirely clear where Mr Tivey resides but it may be necessary for him to travel at least from the Eastern States.
Against all of that the defendant pointed to the fact proceedings were on foot in Singapore and Mr Tivey was participating fully in those proceedings and pursuing a counterclaim. Counsel made the point even if a stay of these proceedings was not granted the proceedings in Singapore could continue. The consequence could be inconsistent verdicts in different jurisdictions.
In my view there is no basis for concluding a permanent stay ought be granted on the basis Western Australia is a clearly inappropriate jurisdiction. It is obviously desirable there be one set of proceedings in this matter and the parties resolve their differences in those proceedings. But what I am required to determine is whether or not Western Australia is a clearly inappropriate forum. When all of the matters raised by the plaintiff are taken into account no such conclusion can be reached. I am mindful that this is not a balancing exercise. What I have to determine is whether there are sufficient factors indicating the forum is clearly inappropriate. In my view there are not sufficient factors to reach that conclusion and a permanent stay would not be justified.
It was not entirely clear from the written and oral submissions put on behalf of the defendant that they accepted there was a difference in the principles applicable to the grant of a permanent stay as against a temporary stay. The plaintiff on the other hand submitted a court may grant a temporary stay of its proceedings pending the determination of foreign proceedings if, after consideration of a range of factors, it is desirable that the foreign proceedings be determined first. In formulating the principle in this way counsel relied upon Sterling Pharmaceuticals Pty Ltd v The Boots Company (Australia) Pty Ltd [1992] FCA 72; (1992) 34 FCR 287; Henry v Henry; and Pilbara Iron Ore Pty Ltd v Ammon [2008] WASCA 202 [23], [56]. Refining that broad statement of principle still further, counsel submitted a court will consider a range of factors including the order of commencement of the proceedings, the effect of a stay, the public interest, the undesirability of two courts competing to determine facts first, the circumstances relating to witnesses, the extent of preparation already undertaken, the extent of the waste of work already completed and the goal of striving against the multiplicity of proceedings in relation to similar issues. A court will also attempt to balance the advantages and disadvantages to each party.
Dealing with these issues it is relevant to note the plaintiff commenced these proceedings on 30 September 2014 and served the process in this State on 1 October 2014. The plaintiff invoked the regular jurisdiction of this court. The defendant subsequently commenced the proceedings in Singapore but required leave from the High Court of the Republic of Singapore to serve the process in Australia. That leave was obtained on 3 November 2014. Service was effected on 18 November 2014. The plaintiff maintained there were no undesirable consequences associated with not granting a temporary stay. The defendant pointed again to the proceedings against Mr Tivey and the fact they would continue in Singapore. This it was said was a compelling reason for granting a temporary stay.
There is no doubt it is unsatisfactory to have two proceedings on foot at the same time in different jurisdictions. It is expensive and inconvenient for the parties and a waste of judicial resources. The plaintiff accepted that was the case. Counsel submitted the answer was for the proceedings in this court to go ahead and for the proceedings in Singapore to be stayed. Of course that is a matter for the defendant and the court in Singapore.
There is no perfect solution to this problem. In the end I am not satisfied there is a basis for granting a temporary stay. The points against the granting of such a stay are the invocation of the regular jurisdiction of the court and the fact these proceedings were commenced first. It is strongly arguable the law of Western Australia is the law of contract to be applied and the disadvantages associated with having a trial in Western Australia are not such as to warrant even a temporary stay. Those factors are to be weighed in the balance with the fact of the Singapore proceedings and Mr Tivey's participation in those proceedings. But allowing for all matters it seems to me the defendant has not made out a case for a temporary stay of this action.
The defendant's application will be dismissed. The defendant should pay the costs of the application including the reserved costs.
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