ZETA-PDM Ltd v Petro Technology Australia Pty Ltd
[2011] WASC 338
•8 DECEMBER 2011
ZETA-PDM LTD -v- PETRO TECHNOLOGY AUSTRALIA PTY LTD [2011] WASC 338
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2011] WASC 338 | |
| Case No: | FRJ:3/2011 | 7 NOVEMBER 2011 | |
| Coram: | MASTER SANDERSON | 8/12/11 | |
| 8 | Judgment Part: | 1 of 1 | |
| Result: | Registration of judgment set aside | ||
| B | |||
| PDF Version |
| Parties: | ZETA-PDM LTD PETRO TECHNOLOGY AUSTRALIA PTY LTD |
Catchwords: | Setting aside judgment arbitration claim in registered foreign agreement between parties Failure of judgment debtor to co-operate Application of Act to facts |
Legislation: | Nil |
Case References: | National Commercial Bank v Wimborne (1979) 11 NSWLR 156 Scott v Avery (1856) 10 ER 1121 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Judgment Creditor
AND
PETRO TECHNOLOGY AUSTRALIA PTY LTD
Judgment Debtor
Catchwords:
Setting aside judgment arbitration claim in registered foreign agreement between parties - Failure of judgment debtor to co-operate - Application of Act to facts
Legislation:
Nil
(Page 2)
Result:
Registration of judgment set aside
Category: B
Representation:
Counsel:
Judgment Creditor : Mr G K Paull
Judgment Debtor : Mr N P Gentilli
Solicitors:
Judgment Creditor : Butcher Paull & Calder
Judgment Debtor : Jackson McDonald
Case(s) referred to in judgment(s):
National Commercial Bank v Wimborne (1979) 11 NSWLR 156
Scott v Avery (1856) 10 ER 1121
(Page 3)
1 MASTER SANDERSON: This is the judgment debtor's application to set aside a foreign judgment registered pursuant to orders I made on 30 August 2011. The facts are not in dispute. In support of its application the judgment debtor relied on an affidavit of Neil Phillip Gentilli sworn on 13 September 2011. No evidence was filed on behalf of the judgment creditor. In his submissions, counsel for the judgment creditor accepted the version of the facts contained in Mr Gentilli's affidavit.
2 On 29 July 2002 the judgment creditor and the judgment debtor entered into an agency agreement. The agreement was in writing and appears as annexure NPG2 to Mr Gentilli's affidavit. In the agency agreement the judgment creditor is referred to as 'the Principal' and the judgment debtor is referred to as 'the Agent'. Relevantly cl 20 and cl 21 are in the following terms:
Law
20 This agreement shall in all aspects be governed and interpreted in accordance with the Laws of England.
Arbitration
21. Any dispute or difference between the Parties hereto shall be referred to arbitration in England under the provisions of the Arbitration Act 1950 or any statutory modifications or re-enactment thereon.
3 A dispute arose between the parties. On 6 October 2010 Astle Paterson, a firm of English solicitors acting for the judgment creditor, wrote to the judgment debtor referring to the dispute and seeking to have the matter referred to arbitration. The judgment debtor did not reply to the correspondence. Astle Paterson again wrote to the judgment debtor on 21 October 2010 seeking payment of the alleged debt and stating if payment was not made or an arbitrator was not nominated proceedings would be issued. The debt was not paid and an arbitrator was not nominated by the judgment debtor. On 23 November 2010 the judgment creditor issued proceedings in the Burton upon Trent County Court.
4 Under cover of letter dated 6 December 2010 Astle Paterson forwarded to the judgment debtor a bundle of documents which showed proceedings had been issued in the County Court, the nature of the judgment creditor's claim and detailing what the judgment debtor was to do to defend the proceedings. Again the judgment debtor did nothing. In his affidavit Mr Gentilli says the judgment debtor resolved to take no action to meet the claim in the County Court but to 'challenge the claim if
(Page 4)
- and when any action was taken to pursue to the claim in Western Australia'.
5 The application to set aside the registration of the judgment is brought under s 7(2) of the Foreign Judgments Act 1991 (Cth). That section materially provides:
Where a judgment debtor duly applies to have the registration of the judgment set aside, the court:
(a) must set the registration of that judgment aside if it is satisfied:
...
(iv) that the courts of the country of the original court had no jurisdiction in the circumstances of the case.
[T]he courts of the country of the original court are not taken to have had jurisdiction:
...
(b) ... if the bringing of the proceedings in the country of the original court was contrary to an agreement under which the dispute in question was to be settled otherwise than by proceedings in the courts of the country of that court.
7 It is common ground between the parties that the Arbitration Act 1950 (UK) has long been superceded. It was replaced by Arbitration Acts enacted in 1975 and 1979 with amendments to those Acts in 1990. The legislation received a major overhaul in the late 1980s and the early 1990s leading to the enactment of the Arbitration Act 1996 (UK). It may well be this latest Act falls within the rubric of 'any statutory modification or re-enactment' of the Arbitration Act 1950 which is found in cl 21 of the agreement. But whether that is so or not is not in issue. Neither party sought to place any reliance on the English legislation.
8 On behalf of the judgment debtor it was said there was in place an agreement under which the dispute in question was to be settled otherwise than by proceedings in the courts of England. That being so the courts of England are taken not to have had jurisdiction. Therefore the judgment debtor satisfies the requirements of s 7(2)(a)(iv) and the registration of the judgment must be set aside.
(Page 5)
9 Counsel submitted this was the case even if, as in this jurisdiction, an arbitration clause such as cl 21 would not prevent proceedings being issued in a court. In this jurisdiction under s 55 of the Commercial Arbitration Act 1985 (WA) a court can deal with a dispute between parties even when there is an arbitration agreement in the form of a Scott v Avery clause (Scott v Avery (1856) 10 ER 1121). Clause 21 is clearly not a Scott v Avery clause. In this jurisdiction the court is given a discretion to stay proceedings if those proceedings relate to an agreement which has an arbitration clause. The party who wishes to go to arbitration must bring an application to stay the proceedings and the court has a wide discretion to grant or refuse the stay.
10 It was the judgment debtor position that it did not matter what the law in England in relation to arbitration clauses might be. The wording of the Foreign Judgments Act was clear and this case fell within the section. Therefore registration had to be set aside.
11 On behalf of the judgment creditor reference was made to the documents which were served on the judgment debtor. Attached to the claim form were the particulars of claim and a document headed 'notes to defendant on replying to claim form'. The notes included the warning 'if you do not reply judgment may be entered against you'.
12 In addition, one of the ancillary documents forwarded to the judgment debtor by Astle Paterson under cover of its letter of 6 December 2010 was Form EX303 entitled 'A court claim has been made against me - what should I do?'. Form EX303 explains inter alia what happens if the claim is ignored and includes the warnings:
You should act quickly. You only have a short period of time within which to respond ...
If your response is not received within 14 days, the court can either make an order that you pay the amount claimed or decide the amount you are liable for. This is known as a County Court judgment.
13 Also included with the letter of 6 December 2010 was what is described as a 'response pack'. This included a form to be completed by the judgment debtor and filed by the judgment debtor in the event it wished to defend the United Kingdom proceedings or make a counterclaim. The upper portion of the first page of the response pack describes the action that needs to be taken by a defendant depending upon whether the claim is to be admitted in whole or in part or disputed. It also
(Page 6)
- makes provision for a defendant to dispute jurisdiction. It includes the warning 'if you do nothing judgment may be entered against you'.
14 The lower portion of the same page is the 'acknowledgment of service' form. It includes a section allowing a defendant to simply tick a box to indicate an intention to contest jurisdiction. The acknowledgment of service form also includes the words:
If you do not file and application to dispute the jurisdiction of the court within 14 days of the date of filing this acknowledgement of service, it will be assumed you accept the court's jurisdiction and judgment may be entered against you.
15 In the light of these facts the judgment creditor submits the proper time to put any argument in relation to jurisdiction was in response to the United Kingdom proceedings and in accordance with the rules of procedure applicable to those proceedings. The judgment debtor knew the consequences of a failure to respond and a failure to dispute the jurisdiction of the United Kingdom court. It was submitted it was too late now for the judgment debtor to raise a want of jurisdiction as a basis for setting aside the registration of the foreign judgment. Particular emphasis was placed by counsel on the fact the judgment debtor was warned and must be taken to have known that to do nothing was to effectively submit to the jurisdiction of the United Kingdom court.
16 Counsel also referred to s 7(5) of the Foreign Judgments Act. That section is in the following terms:
For the purposes of subparagraph (3)(a)(i), a person does not voluntarily submit to the jurisdiction of a court by:
(a) entering an appearance in proceedings in the court; or
(b) participating in proceedings in the court only to such extent as is necessary;
for the purpose only of one or more of the following:
(c) protecting, or obtaining the release of:
(i) property seized, or threatened with seizure, in the proceedings; or
(ii) property subject to an order restraining its disposition or disposal;
(d) contesting the jurisdiction of the court;
(Page 7)
- (e) inviting the court in its discretion not to exercise its jurisdiction in the proceedings.
17 It was submitted by counsel the judgment debtor could have contested the jurisdiction of the County Court without in any way prejudicing its position. The fact it did not so contest the jurisdiction is evidence it actually submitted to the jurisdiction of the court and is therefore bound by the decision.
18 In response to these arguments counsel for the judgment debtor maintained nothing it had done could be regarded as an act of submitting to the jurisdiction of the English court. Counsel pointed out s 7(5)(d) - (e) of the Foreign Judgments Act offered protection to a party. Counsel submitted it could not be said in failing to avail itself of the protections offered by these subsections a party in some way submitted to the jurisdiction of the court. Furthermore, counsel submitted in doing nothing the judgment debtor had made it plain it was not submitting to the jurisdiction of the English court. In this respect reliance was placed on the decision of Holland J in National Commercial Bank v Wimborne (1979) 11 NSWLR 156. His Honour was dealing with the circumstances when a party may be taken to have waived its rights to object to jurisdiction. His Honour said:
To constitute waiver the facts must show a voluntary act unequivocally evincing an intention to abandon or not to assert a right and such intention may be express or its existence imputed from conduct. Electing to act on one of two inconsistent rights or choosing to act in a way clearly inconsistent with the right in question is a basis in some, if not all, cases for imputing the intention even if it was not subjectively in the mind of the party (176).
- His Honour then went on:
I would add that ... the mere failure to assert an objection when the possibility of cross-claims emerged that is said to be conduct of waiver. In my opinion, something more is needed to impute waiver, some positive and definitive step that can be seen to be incompatible with an intention to maintain an objection to jurisdiction (181).
(Page 8)
- the judgment debtor is entitled to have the registration of the judgment set aside.
20 For these reasons and subject to hearing from the parties I will make orders in terms of the judgment debtor's chamber summons.
0
1
1