Sakari Resources Ltd v Purvis - [2016] WASCA 24

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: SAKARI RESOURCES LTD -v- PURVIS [2016] WASCA 24

CORAM: BUSS JA
NEWNES JA
MURPHY JA

HEARD: 6 OCTOBER 2015

DELIVERED : 2 FEBRUARY 2016

FILE NO/S: CACV 43 of 2015

BETWEEN: SAKARI RESOURCES LTD (ARBN 132 692 481)
Appellant
AND
MARTIN DAVID PURVIS
Respondent

ON APPEAL FROM:
Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA
Coram  :MASTER SANDERSON
Citation  :PURVIS -v- SAKARI RESOURCES LTD [2015] WASC 63
File No  :CIV 2372 of 2014

Catchwords:

Conflicts of laws - Application for stay of proceedings - Related proceedings commenced by defendant in Singapore involving additional parties - Relevant principles - Whether continuation of local proceedings would be vexatious or oppressive to defendant - Need to consider local proceedings in context of controversy as a whole

Legislation:

Nil

Result:

Appeal dismissed

Category: B

Representation:

Counsel:

Appellant: Mr M D Howard SC
Respondent: Mr H J Dixon SC & Mr A Gotting

Solicitors:

Appellant: MKI Legal
Respondent: Ashurst Australia

Case(s) referred to in judgment(s):

CSR v Cigna Insurance Australia Ltd [1997] HCA 33; (1997) 189 CLR 345
Voth v Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538

BUSS JA: I agree with Newnes JA.
NEWNES JA: This is an appeal from a decision of Master Sanderson who dismissed the appellant's application for a stay of proceedings commenced by the respondent against the appellant in the general division of this court (the WA proceedings). In the WA proceedings, the respondent claims the sum of AUD$554,454.17, said to be the balance of a termination payment owing to the respondent pursuant to his contract of employment with the appellant.
Shortly after being served with the WA proceedings, the appellant, a company incorporated in the Republic of Singapore, commenced proceedings in the High Court of Singapore (the Singapore proceedings) relating to the matters raised in the WA proceedings. It then made the application to the master for an order staying the WA proceedings permanently. It did so, in substance, on the ground that the continuation of the WA proceedings would be vexatious or oppressive to the appellant. In the alternative, it sought a temporary stay of the WA proceedings pending the outcome of the Singapore proceedings.
The master dismissed the application. The appellant contends that the master erred in doing so.
The appellant requires leave to appeal: Supreme Court Act 1935 (WA), s 60(1). On 24 March 2015, the application for leave was referred to the hearing of the appeal.

Background

The proceedings in this court

The respondent's action against the appellant was commenced by a specially indorsed writ of summons filed on 30 September 2014 and served on the appellant in Western Australia on 1 October 2014.
In the statement of claim, the respondent pleads that, by an agreement made on or about 7 October 2010 (the employment agreement), he was appointed chief executive officer of the appellant. The employment agreement is said to have been partly express and partly implied, the express part being constituted by a written executive service agreement. The executive service agreement is alleged to have been executed by the respondent and, on behalf of the appellant, by Mr Jerkovic, a director, and Mr Tivey, the company secretary. It is

alleged that its execution by both the respondent and Mr Jerkovic occurred in Perth.

The respondent pleads that under the employment agreement his employment was to commence from 1 March 2010 for an initial term of three years and six months, and to continue indefinitely beyond that term unless terminated by either party pursuant to the employment agreement. He also alleges, relevantly, that it was a term of the employment agreement that the appellant could terminate the respondent's employment upon six months' notice, or alternatively by payment in lieu of such notice and the making of a severance payment and payment of superannuation benefits (the termination payment).
The respondent pleads that, on 21 February 2013, the chairman of the appellant orally notified him that his appointment as chief executive officer of the appellant would not be extended beyond the initial term and that he would be provided with six months' notice of termination of his employment. The respondent says that, by a letter dated 28 February 2013, the chairman confirmed that the respondent's appointment would not be extended and that he would be made redundant.
It is alleged that, from February 2013 to August 2013, the appellant paid the respondent's aggregate salary package in equal monthly instalments to a bank account in Perth and provided the respondent with a motor vehicle in Perth as part of his salary package.
The respondent pleads that, by a letter dated 28 August 2013, the appellant was informed that his appointment as chief executive officer would not be extended beyond the initial term but would be terminated in accordance with the employment agreement with a termination payment made to compensate for loss of office. On 29 August 2013, the respondent's employment was terminated.
It is alleged by the respondent that, on 9 September 2013, the appellant paid the sum of AUD$2,648,288.81 in respect of the termination payment into a bank account in Perth and, in or about September 2013, informed the respondent that it was withholding the sum of AUD$1,223,191.72 in respect of anticipated taxation payable on the termination payment. The respondent pleads that subsequently, in October 2013, the Inland Revenue Authority of Singapore notified the appellant that taxation in the sum of SGD$651,982.66 (AUD$554,454.17) was payable and the appellant then paid that sum.
The respondent pleads that the appellant has failed to pay the balance of AUD$668,737.55 owing in respect of the termination payment and he claims that sum.
The respondent also pleads, albeit in anticipation of defence, that, on 3 January 2014, the appellant claimed the termination payment was unauthorised and that the respondent held the money paid to him on trust for the appellant. The respondent says that the termination payment was authorised by the employment agreement or, alternatively, by the chairman of the appellant, and denies that he holds the funds on trust.
The appellant filed a conditional appearance to the writ on 13 October 2014. It did not, however, apply to set aside service of the writ before making the application for a stay of the proceedings, with the result that the appearance became unconditional.
The appellant has not filed a defence to the claim but the other matters in issue between the parties sufficiently emerge from the Singapore proceedings subsequently commenced by the appellant.

The Singapore proceedings

The Singapore proceedings were commenced on 14 October 2014, two weeks after the respondent's writ and statement of claim were served on the appellant. The defendants to the Singapore proceedings are the respondent; Mr Glare, general manager - human resources of the appellant; and Mr Tivey.
Leave to serve the proceedings on the respondent and Mr Glare in Western Australia was granted by the High Court of Singapore on 3 November 2014. It appears that service was effected on the respondent on 18 November 2014 and on Mr Glare on 19 November 2014. Each filed a memorandum of appearance on 4 December 2014. (It was common ground that under Singapore law the filing of a memorandum of appearance does not amount to consent to the jurisdiction.)
In the meantime, a memorandum of appearance had been filed by Mr Tivey on 16 October 2014.
In its claim against the respondent, the appellant puts the term of the respondent's employment quite differently. It pleads, in effect, that under the employment agreement the respondent's appointment as chief executive officer terminated at the expiration of the initial term of three years and six months unless he was reappointed by the appellant, in which case his appointment would continue indefinitely unless terminated by either party in accordance with the employment agreement.
The appellant pleads that, on or about 21 February 2013, it notified the respondent that it would not be extending his appointment beyond the initial term and confirmed that by a letter dated 28 February 2013. The appellant pleads that, by a letter dated 29 July 2013, it reiterated that the respondent's appointment would not be extended and clarified that the respondent's employment was not being terminated in circumstances of redundancy. The respondent's employment as chief executive officer ceased on 31 August 2013.
The appellant alleges that the letter of 28 August 2013 to the respondent (see [11]) was issued and/or signed by the respondent, and by Mr Glare (whom it describes as responsible for all human resources‑related matters of the appellant) and Mr Tivey, without the knowledge or authorization of the appellant, and that the subsequent payment of AUD$2,648,288.81 to the respondent was also allowed or caused by those parties without the knowledge or authorization of the appellant.
It is alleged that under the employment agreement the respondent was not entitled to the termination payment because his employment was not terminated but had expired at the end of the initial term. In the alternative, it is alleged that if the employment agreement provided for such a termination payment, the respondent is not entitled to it because he had engaged in serious and wilful misconduct. In support of the latter plea, it is alleged that the respondent and Messrs Glare and Tivey were aware that such payments required the approval of the appellant's board, remuneration committee and/or shareholders, but they deliberately did not inform those bodies of the payments or obtain their approval for them.
The appellant alleges that by that conduct the respondent and Messrs Glare and Tivey had each acted in breach of their duties to the appellant and/or their contracts of employment and/or trust.
It is also alleged that, in breach of their duties to the appellant and/or their contracts of employment and/or in breach of trust, the respondent and Mr Glare had caused funds in the sum of AUD$28,922.30 to be withdrawn from the appellant's bank account to pay for personal tax advisory services when they were aware that it was not the practice or policy of the appellant to pay for such services.
The appellant claims against the respondent, in substance:
(1)declarations that:
(a)the respondent is not entitled to the termination payment;
(b)the respondent has breached his duties to the appellant and/or his contract of employment and/or is in breach of trust;
(c)the respondent is liable to account to the appellant for the sum of AUD$3,186,214.82;
(2)damages for breach of contract and/or duty; and
(3)an order that the respondent repay the sum of AUD$3,186,214.82 to the appellant.
It claims against Mr Glare, in substance:
(1)declarations that:
(a)he has breached his duties to the appellant and/or is in breach of trust; and
(b)he is liable to account to the appellant for the sum of AUD$3,186,214.82;
(2)damages for breach of duty; and
(3)an order that he repay the sum of AUD$3,186,214.82 to the appellant.
Similar relief is sought against Mr Tivey, except that the amount claimed is AUD$3,151,757.32.
Mr Tivey filed a defence and counterclaim, dated 6 November 2014, and an amended defence and counterclaim, dated 21 November 2014. In turn, the appellant has filed a reply and defence to counterclaim, dated 8 December 2014.
It is unnecessary to canvass Mr Tivey's pleading in any detail. Suffice it to say that in his defence Mr Tivey denies that under the employment agreement the respondent's employment as chief executive officer terminated on 31 August 2013 unless extended, and says that it continued indefinitely beyond the fixed term unless terminated in accordance with the employment agreement. He also says, among other things, that the appellant knew of and/or authorised the termination payment as, on or about 27 August 2013, Mr Glare had told the appellant's board of directors and remuneration committee of it and no objection had been raised. Mr Tivey denies that he was in breach of his duties to the appellant.
In his counterclaim, Mr Tivey alleges that the appellant's purported termination of his employment on the grounds of serious and wilful misconduct was wrongful and repeats his denial that he was in breach of his duty to the appellant. He claims salary and other benefits of which he says he was deprived by reason of his wrongful dismissal, in an amount of some AUD$120,000.
In an affidavit filed in opposition to the application for a stay of the WA proceedings, the respondent says that he instructed solicitors in Singapore to apply to set aside the orders made by the Singapore High Court for service on him of the originating process in the Singapore proceedings. The respondent says that on 17 December 2014, the Singapore High Court adjourned the Singapore proceedings to 3 February 2015 and gave leave for a further adjournment to be sought pending a decision on the appellant's application for a stay of the WA proceedings. Neither party addressed the current position but I assume that at the present time the Singapore proceedings remain adjourned.

The application for a stay

As mentioned above, the appellant commenced the Singapore proceedings on 14 October 2014, some two weeks after service on it of the proceedings in this court. The appellant's application for a stay of the proceedings in this court was filed on 27 October 2014. The master's reasons for dismissing the application were as follows.

The reasons of the master

The master first canvassed the respondent's claim against the appellant and then set out briefly the substance of the appellant's pleaded claim in the Singapore proceedings, which he went on to summarise as follows:
[The respondent] had an employment contract with [the appellant]. [The appellant] decided not to renew that contract. Under the terms of the contract [the respondent] did not have an entitlement to any or any significant Termination Payment. Nonetheless [the respondent, Mr Glare and Mr Tivey] in breach of their contracts with the [the appellant] and in breach of duties they owed to the [the appellant] determined [the respondent] should be paid a Termination Payment and actually arranged for that payment to be made. As an alternative, if [the respondent] 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 [14].
The master rejected the appellant's submission that the Singapore proceedings were much broader in scope than the WA proceedings. The master noted that in the WA proceedings the respondent had pleaded, in anticipation of defence, the substance of the matters raised against him in the Singapore proceedings. The master said that in the normal course the appellant would have put on a defence in the WA proceedings alleging that the respondent was not entitled to the payment, for the reasons it subsequently set out in the Singapore proceedings, and would have counterclaimed to recover the money that had been paid, probably joining Mr Glare and Mr Tivey as parties to the counterclaim [15].
The master observed that on an application of this nature the focus is on the inappropriateness of the forum court and not upon the appropriateness or comparative appropriateness of another court. He noted that a court is not a clearly inappropriate forum merely because an alternative court is considered more appropriate [18].
The master drew five propositions from the authorities to which he referred. Those cases included Voth v Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538 but did not include CSR v Cigna Insurance Australia Ltd [1997] HCA 33; (1997) 189 CLR 345. The propositions were, first, that the 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, a stay of proceedings on the ground of forum non conveniens is only made in a clear case [20].
The master noted that the respondent relied upon the following connecting factors with this jurisdiction:
(1)the respondent resides here;
(2)his assets, his documents and his bank account are here and, apart from a bank account, he has no assets in Singapore;
(3)the payments made by the appellant were paid to a bank account located here;
(4)his solicitors are located here and it would be more expensive for him to litigate in Singapore, where he would have to instruct new solicitors;
(5)if the litigation is conducted here he will be able to secure the attendance at trial of Mr Glare, who is resident here, and of Mr Tivey, who is resident in Victoria; and
(6)the proper law of the contract is Western Australian law [21] ‑ [23].
The master noted that, on the other hand, if the action proceeded in this jurisdiction the principal witness for the appellant and at least five other witnesses would have to travel here from Thailand; there were proceedings already on foot in Singapore in which Mr Tivey was participating; and even if the stay were not granted the proceedings in Singapore could continue, with the prospect of inconsistent outcomes [24] ‑ [25].
The master concluded that 'when all of the matters raised by the [respondent] are taken into account' it could not be concluded that Western Australia was a clearly inappropriate forum [26].
Nor was the master satisfied that the grounds had been made out for a temporary stay pending the determination of the Singapore proceedings. He considered that the factors against the granting of such a stay were that the proceedings in this court had been regularly invoked by the respondent and were commenced first; it was strongly arguable the proper law of the contract was Western Australian law; and the disadvantages associated with having a trial in Western Australia were not such as to warrant such a stay, notwithstanding that the Singapore proceedings were on foot and Mr Tivey was participating in them [28] ‑ [30].
Accordingly the master dismissed the application.

The grounds of appeal

The grounds of appeal were, in substance, as follows:
(1)In deciding whether this jurisdiction was a clearly inappropriate forum, the master erred by considering only factors said to connect the respondent's claims to this Court or jurisdiction and failing to have regard to:
(a)the controversy as a whole between the appellant, the respondent, Mr Glare and Mr Tivey, or, at the least, the controversy as a whole between the appellant and the respondent; and
(b)the existence of the Singapore proceedings.
(2)The master erred by finding that the Singapore proceedings were not broader than, or different from, the proceedings in this Court and should have found that in the Singapore proceedings the appellant had made allegations as to matters which were significantly broader and different in character from those raised in the proceedings in this Court.
(3)If the master found there was a serious question as to the jurisdiction of the Singapore High Court to determine the appellant's claims against the respondent and Mr Glare, he was in error as there was no evidence that it lacked jurisdiction. If persuaded there was a serious question as to the Singapore High Court's jurisdiction, the master should have temporarily stayed the Western Australian proceedings to allow the jurisdiction of the Singapore High Court to be decided by that court before determining the appellant's application for a stay.

The disposition of the appeal

Grounds 1 and 2

I did not understand there to be any dispute as to the relevant principles to be applied, which for present purposes can be shortly stated.
Where a party has regularly invoked the jurisdiction of an Australian court, the proceedings will not be stayed unless the defendant can establish that, having regard to the circumstances of the case and the availability of an appropriate tribunal in a foreign country, the Australian court is clearly so inappropriate a forum for the determination of the dispute that it would be oppressive or vexatious for the proceeding to continue. The continuation of the proceedings will be oppressive where they would be 'seriously and unfairly burdensome, prejudicial or damaging'; and will be vexatious where they would be 'productive of serious and unjustified trouble and harassment to the defendant': Voth, 555; CSR v Cigna Insurance, 390 ‑ 391.
Where, however, there are both local proceedings and proceedings in a foreign jurisdiction arising out of the same sub‑stratum of fact, but raising different issues between the same parties or involving different parties, the local proceedings must be considered in the context of the controversy as a whole arising out of that sub-stratum of fact in order to determine whether the continuation of the local proceedings would be 'vexatious or oppressive.' In CSR v Cigna Insurance, 401, the majority said:
In cases such as the present, where different issues are involved in the local and foreign proceedings, albeit that the different proceedings arise out of the same substratum of fact, the question is not whether the Australian court is a clearly inappropriate forum for the litigation of the issues involved in the Australian proceedings. Rather, the question must be whether, having regard to the controversy as a whole, the Australian proceedings are vexatious or oppressive in the Voth sense of those terms, namely, that they are "productive of serious and unjustified trouble and harassment" or "seriously and unfairly burdensome, prejudicial or damaging".
It was common ground that the onus of establishing that the proceedings are vexatious or oppressive in the Voth sense lay on the appellant.
The appellant submitted that in refusing to stay the WA proceedings the master had erroneously considered simply factors which connected the respondent's claim to this jurisdiction, rather than considering whether, having regard to the controversy between the parties as a whole, including the matters raised by the appellant in the Singapore proceedings, the continuation of the WA proceedings would be vexatious or oppressive in the Voth sense.
It was submitted that, contrary to the master's view, the Singapore proceedings were clearly broader in scope than the WA proceedings. The Singapore proceedings concerned the conduct not only of the respondent (who moreover was based in Singapore at the material time) but also that of Mr Glare and of Mr Tivey (who was also based in Singapore at the material time), all of whom were employed by the appellant. In those proceedings, it was alleged that they had individually and together caused the appellant to make payments from Singapore to the respondent which should not have been made; breached duties owed to the appellant in respect of property located in Singapore; and misled the appellant, its directors and remuneration committee in Singapore. In respect of the respondent, it was also alleged that he had breached obligations he owed to the appellant under the Singapore Companies Act.
The appellant submitted that having regard to the place where those events had occurred, the natural seat of the litigation lay in Singapore. If the WA proceedings were not stayed the appellant, a Singapore company, would be forced to litigate matters dealing with its corporate governance, and events and transactions that had occurred in Singapore, in the WA proceedings. In addition, there would be a duplication of the proceedings involving Mr Tivey, which were being actively litigated by Mr Tivey in the Singapore proceedings.
In my view, the master was in error in the approach he took. The Singapore proceedings involve claims against additional parties in Mr Glare and Mr Tivey, and include the counterclaim by Mr Tivey. In those circumstances, the question the master had to determine was whether, having regard to the controversy as a whole, the WA proceedings are vexatious or oppressive in that they are 'productive of serious and unjustified trouble and harassment' or 'seriously and unfairly burdensome, prejudicial or damaging'.
In considering whether a permanent stay should be granted, the master canvassed a number of connecting factors the respondent said he had with this jurisdiction and the personal advantages to the respondent that were said to be associated with the proceedings continuing in this court. He also referred to the availability of the witnesses who would be called at the trial of the WA proceedings, and to the concurrent existence and the possible continuation of the Singapore proceedings. The master then concluded at [26] as follows:
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 is clear, in my respectful view, that the master did not turn his mind to whether, having regard to the controversy between the parties as a whole, the continuation of the WA proceedings would be vexatious or oppressive in the Voth sense. The master acknowledged the desirability of all the matters in issue between the parties being resolved in one set of proceedings, but it is evident that he considered the question he had to determine was simply whether Western Australia was a clearly inappropriate forum for the litigation of the issues in the WA proceedings. He refused to grant the stay on the basis that it was not. In taking that approach, the master erred and these grounds of appeal should be upheld.

Ground 3

This ground was not addressed in oral argument and on the appeal the appellant did not seek to challenge the Master's refusal to grant a temporary stay pending the determination of the Singapore proceedings (ts 18). In my view, the ground is misconceived. I can see nothing in the reasons of the master to suggest that he took into account any question as to the jurisdiction of the Singapore High Court to entertain the Singapore proceedings. Rather, the master refused to grant a temporary stay of the WA proceedings on the ground that no basis for it had been made out. It is implicit in his finding that he accepted for the purposes of the application that the Singapore High Court had jurisdiction to entertain the Singapore proceedings and he did not suggest otherwise.
I would dismiss this ground.

The determination of the application for a permanent stay

It was common ground that if grounds 1 and 2 of the appeal were upheld this court should determine the appellant's application for a permanent stay of the WA proceedings rather than remit it for rehearing. That is the appropriate course. The application was determined on the affidavit evidence and this court would be at no disadvantage in determining it.
I would dismiss the application. I am far from persuaded that the continuation of the WA proceedings would be vexatious or oppressive in the relevant sense.
It was contended in the appellant's written submissions that a number of factors supported the grant of a permanent stay, namely, that the overall dispute was centred in Singapore in that the appellant was a Singapore company and the relevant dealings and the respondent's alleged breaches had occurred there; the dispute involved certain issues of Singapore law including allegations of breaches of the Singapore Companies Act; there were proceedings on foot in Singapore which would continue at least in respect of Mr Tivey; and, of the five witnesses the appellant wished to call, four are resident in Thailand and one in Singapore.
In his oral submissions, senior counsel for the appellant reduced that to two bases upon which it was contended that the continuation of the WA proceedings would be vexatious or oppressive in the relevant sense. First, it was submitted that Mr Tivey may pursue his counterclaim in the Singapore proceedings, in which case the appellant would be involved in litigation with Mr Tivey in respect of essentially the same sub‑stratum of fact in both the WA proceedings and the Singapore proceedings. Secondly, it was submitted that the appellant would be litigating matters dealing with its corporate governance, its board of directors and its remuneration committee, away from its centre of operations where the relevant events occurred. That would involve disruption to the appellant as its witnesses, who ordinarily spent their time, or a good deal of their time, in Singapore, would be required to travel to Perth to give evidence.
In my opinion, the matters relied upon by the appellant, both individually and collectively, fall a long way short of establishing that the continuation of the WA proceedings would be seriously and unfairly burdensome, prejudicial or damaging, or productive of serious and unjustified trouble and harassment, to the appellant.
The position in relation to Mr Tivey's counterclaim is not assisted by the fact that this point was not raised below by the appellant or, indeed, in its written submissions on the appeal. It was first raised in oral argument on the appeal. There was, therefore, no evidence as to Mr Tivey's attitude to the continuation of his counterclaim in the Singapore proceedings in the event that there was no stay of the WA proceedings. In fact, there was no evidence as to whether he was even aware of the WA proceedings. The appellant did not suggest that there would be any obstacle to Mr Tivey bringing the same claim in the WA proceedings but argued that he may not do so and accordingly the prospect of litigation in two jurisdictions on essentially the same sub‑stratum of fact remained a real possibility.
I do not think there is much weight in that argument. Had the appellant raised the point below, it may well have been clarified by affidavit evidence. As it is, whether in the absence of a stay of the WA proceedings Mr Tivey would insist on litigating his counterclaim in the Singapore proceedings remains a matter of conjecture and of little assistance to the appellant. There is, however, force in the submission of senior counsel for the respondent that it is unlikely Mr Tivey would take that course in circumstances where the WA proceedings continued and the appellant defended them, in substance, on the basis set out in the Singapore proceedings ‑ as the appellant has said in an affidavit filed in support of its application that it will do.
It is not suggested there is any reason the various matters raised by the appellant in the Singapore proceedings cannot be ‑ and indeed could not from the outset have been ‑ litigated in the WA proceedings, by way of defence or counterclaim, with Mr Glare and Mr Tivey being joined as parties to the counterclaim for that purpose. To the extent that any of the matters relied on by the appellant in the Singapore proceedings may involve Singapore law, it is not suggested there would be any significant difficulty in pursuing them in the WA proceedings. In fact, there is no evidence that any relevant Singapore law differs significantly, or at all, from Australian law. In that context, I should observe that on what is perhaps the primary issue between the parties, the proper construction of the employment agreement, it is at least reasonably arguable that the proper law is Western Australian law. The significance to be attached to the facts that the alleged breaches occurred in Singapore and the overall dispute is said to involve certain issues of Singapore law seems to me to be slight.
The second contention advanced by the appellant does not seem to me to be of any greater weight. It is evident that wherever the litigation takes place, there will, on both sides, be the inconvenience associated with witnesses having to travel to give evidence. Four of the five witnesses proposed to be called by the appellant reside in Thailand and will have to travel either to Singapore or Perth. In the present context, the difference in travelling time and inconvenience is not material. At least two of the witnesses proposed to be called by the respondent will have to travel from other States of Australia, and one of them, Mr Tivey, possibly from overseas.
In my view, nothing that has been put before the court establishes that the continuation of the WA proceedings would be vexatious or

oppressive to the appellant in the Voth sense. I would therefore dismiss the appellant's application. It follows that the appeal should be dismissed.

Conclusion

I would grant leave to appeal but dismiss the appeal.
MURPHY JA: I agree with Newnes JA.

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: SAKARI RESOURCES LTD -v- PURVIS [2016] WASCA 24 (S)

CORAM: BUSS JA
NEWNES JA
MURPHY JA

HEARD: ON THE PAPERS

DELIVERED : 23 MARCH 2016

FILE NO/S: CACV 43 of 2015

BETWEEN: SAKARI RESOURCES LTD (ARBN 132 692 481)
Appellant
AND
MARTIN DAVID PURVIS
Respondent

ON APPEAL FROM:
Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA
Coram  :MASTER SANDERSON
Citation  :PURVIS -v- SAKARI RESOURCES LTD [2015] WASC 63
File No  :CIV 2372 of 2014

Catchwords:

Costs - Indemnity costs - Appeal - Calderbank offer by respondent - Appeal dismissed - Whether rejection of offer by appellant unreasonable

Legislation:

Nil

Result:

Appellant to pay respondent's costs of appeal on party/party basis to date of offer and thereafter on indemnity basis

Category: B

Representation:

Counsel:

Appellant: On the papers
Respondent: On the papers

Solicitors:

Appellant: MKI Legal
Respondent: Ashurst Australia

Case(s) referred to in judgment(s):

Australian Competition and Consumer Commission v Harris Scarfe Australia Pty Ltd (No 2) [2009] FCA 433
Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115
Sakari Resources Ltd v Purvis [2016] WASCA 24

JUDGMENT OF THE COURT: On 2 February 2016, we dismissed an appeal by the appellant from a decision of Master Sanderson who had dismissed the appellant's application for a stay of proceedings commenced by the respondent against the appellant in the general division of this court: Sakari Resources Ltd v Purvis [2016] WASCA 24.
The respondent has applied for an order that the appellant pay its costs of the appeal on an indemnity basis on the ground that the appellant had rejected a Calderbank offer made by the respondent to settle the appeal. Pursuant to orders made on 2 February 2016, the application is to be determined on the papers.

The background

The respondent commenced proceedings against the appellant in the general division of this court (the WA proceedings) claiming the sum of AUD$668,737.55, which the respondent said was the balance of a termination payment to which he was entitled under his contract of employment with the appellant.
Shortly after being served with the WA proceedings, the appellant, a company incorporated in the Republic of Singapore, commenced proceedings against the respondent and two other parties in the High Court of Singapore (the Singapore proceedings) relating to the matters raised in the WA proceedings. It then made an application to the master for an order staying the WA proceedings permanently. It did so, in substance, on the ground that the continuation of the WA proceedings would be vexatious or oppressive to the appellant. In the alternative, it sought a temporary stay of the WA proceedings pending the outcome of the Singapore proceedings.
The master dismissed the application. He found, in substance, that Western Australia was not a clearly inappropriate forum for the WA proceedings [26].
The appellant filed an appeal notice on 4 March 2015 and the appellant's case on 20 March 2015. The respondent's answer was filed on 27 March 2015.
On 14 April 2015, the respondent's solicitors wrote to the appellant's solicitors making an offer, expressed to be a Calderbank offer, to resolve the appeal. The respondent proposed that the appeal be resolved on the basis that:
(1)(a) the application for leave to appeal and the appeal be dismissed;
(b)the appellant be entitled to 50% of its costs of the appeal to the date of the Calderbank offer on a party and party basis; and
(c)there otherwise be no order as to costs in the proceedings;
(2)the appellant file a minute of consent orders to give effect to those terms within seven days of the date of the offer.
In the letter, the respondent reserved the right to seek an order for indemnity costs in the event that the appeal was unsuccessful or that this court dismissed the appellant's application for a stay. Although not expressly stated, it is evident that the latter was based upon an outcome in which the appeal against the master's decision was upheld but that in re‑exercising the discretion this court dismissed the appellant's application for a stay.
The appeal came on for hearing on 6 October 2015. We upheld the appellant's contention, in grounds 1 and 2 of the grounds of appeal, that the master had applied the wrong test. The question the master had to determine was not whether Western Australia is a clearly inappropriate forum for the WA proceedings, but whether, having regard to the controversy as a whole (including the issues raised in the Singapore proceedings), the WA proceedings were vexatious or oppressive in that they would be 'productive of serious and unjustified trouble and harassment' or 'seriously and unfairly burdensome, prejudicial or damaging' to the appellant. A further ground of appeal, relating to the master's refusal of a temporary stay, was not pressed by the appellant on the hearing of the appeal and we concluded that it was without substance.
It was common ground on the appeal that if the contention in grounds 1 and 2 was upheld, this court should determine the appellant's application for a permanent stay of the WA proceedings rather than remit it for rehearing. In re‑exercising the discretion, we concluded that, having regard to the dispute as a whole, the matters relied upon by the appellant, both individually and collectively, fell a long way short of establishing that the continuation of the WA proceedings would be seriously and unfairly burdensome, prejudicial or damaging, or productive of serious and unjustified trouble and harassment, to the appellant.
We therefore dismissed the appellant's application for a stay and dismissed the appeal.

The relevant principles

The principles to be applied on an application for indemnity costs were not in issue. An award of indemnity costs will be justified where the rejection of a Calderbank offer was unreasonable in all the circumstances of the case. In deciding whether the rejection of an offer was unreasonable, regard should ordinarily be had to at least the following factors:
(a)the stage of the proceedings at which the offer was received;
(b)the time allowed to the offeree to consider the offer;
(c)the extent of the compromise offered;
(d)the offeree's prospects of success, assessed as at the date of the offer;
(e)the clarity with which the terms of the offer were expressed; and
(f)whether the offer foreshadowed an application for indemnity costs in the event of the offeree rejecting it.

The assessment of unreasonableness is not to be made with the benefit of hindsight and the rejection of a Calderbank offer will not be unreasonable merely because the offeree is ultimately worse off that it would have been had it accepted the offer.
The party who made the Calderbank offer bears the onus of establishing that the court should make an award of indemnity costs.
See Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115.

The disposition of the application

The appellant submits that its rejection of the offer was not unreasonable. The appellant says that at the time the offer was made it considered the appeal had merit, a view that had been vindicated by the court upholding grounds 1 and 2 of the grounds of appeal. Acceptance of the offer would have meant giving up a reasonably arguable prospect of obtaining the stay, in circumstances where the amount offered by the respondent was 'relatively small' compared to the additional costs to the appellant of litigating in Western Australia, and where there was a risk that its acceptance would compromise the Singapore proceedings.
The appellant submitted that the nature of the issue in dispute was also a factor militating against indemnity costs. It was not a matter where there was room to reach some middle ground. It was an 'all or nothing' case. The outcome of the appeal would determine whether the proceedings were heard in Western Australia or in Singapore, and therefore whether the burden of litigating in a foreign jurisdiction fell on the appellant or the respondent.
We are satisfied that the respondent is entitled to an order for indemnity costs. The appellant does not contend that it was given insufficient notice of the respondent's case on appeal or that it was given inadequate time to consider the offer. In his answer, which was served some 19 days before the offer was made, the respondent denied that the master had erred in the test he applied but also made detailed submissions as to why, if the appeal were upheld, this court should exercise its discretion to refuse the application for a stay of the WA proceedings. All the evidence was on affidavit and at the time the Calderbank offer was made the appellant was in a position to make a proper assessment of its prospects of success and had an adequate opportunity to do so.
We do not accept the appellant's submission, in effect, that it was reasonable for the appellant to reject the offer because the amount offered was 'relatively small' compared to the additional costs the appellant would incur in litigating the dispute in this jurisdiction - a submission, we should note, that was not supported by any attempt to quantify the alleged difference.
Whether it was reasonable for an offeree to reject an offer of compromise is not to be determined merely by comparing the offer with the benefit the offeree stood to gain if it was ultimately successful in the litigation. It is necessary to take into account all of the circumstances of the case, including the offeree's prospects of success, viewed objectively at the time the offer was made. In this case, in order to succeed on the appeal it was necessary for the appellant to establish not only a material error by the master but also that on a proper exercise of the discretion the stay should be granted. While it succeeded on the former, on the latter this court concluded that the matters relied upon by the appellant, both individually and collectively, '[fell] a long way short'. It must have been apparent to the appellant at the time the offer was received that its case for a stay was weak.
In the circumstances, the offer could not be described as involving no real element of compromise on the part of the respondent. It involved the respondent both in foregoing the costs of the appeal to that point to which he would be entitled if the appeal succeeded, and in making a payment of 50% of the appellant's costs of the appeal to the date of the offer. It was an offer of significant benefit to the appellant in an appeal where its prospects of success were slender.
The fact that the nature of the issue on the appeal must lead to an 'all or nothing' outcome does not provide a reasonable basis for rejecting the offer. That is by no means an unusual circumstance in litigation. Nor was this one of those relatively unusual cases where the nature of the matter in issue meant that it was reasonable for the appellant to seek a judicial determination: see Australian Competition and Consumer Commission v Harris Scarfe Australia Pty Ltd (No 2) [2009] FCA 433 [10].
The basis of the appellant's assertion that acceptance of the respondent's offer may have adversely affected the appellant in the Singapore proceedings was not explained and is not apparent.
In the circumstances, it was unreasonable for the appellant to reject the offer.
The appellant was expressly put on notice that the present claim for indemnity costs would be made if the offer was not accepted and the appellant was ultimately unsuccessful. The appellant chose to take its chances on the appeal and must bear the consequences.

Conclusion

The appellant is to pay the respondent's costs of the appeal on a party and party basis to the date of the offer and on an indemnity basis from the date of the offer.