Alstom Limited & Ors v Sirakas

Overview of the parties and four agreements 15There are three plaintiffs. The first plaintiff is Alstom Limited ("Alstom"). It is an Australian company and an ultimate subsidiary of a French company, Alstom SA. APRO, the second plaintiff, is also an ultimate subsidiary of Alstom SA. The third plaintiff is Alstom General Turbo SA ("AGT"). It is a European company and is also a subsidiary of Alstom SA. Companies in the Alstom Group are large suppliers of power generation, plant and equipment. The Alstom Group operates internationally. 16Mr Sirakas was first employed by an Australian company, ABB Power Plants Limited in 1992. As the result of various acquisitions and mergers he became to be employed by Alstom. He was employed by ABB Power Plants Limited under an employment contract made on 4 December 1992. 17After being appointed by Alstom as managing director of APRO from 1 October 2003, Mr Sirakas and Alstom entered into an agreement dated 1 April 2004 called a " Detachment Agreement ". The parties to that agreement were Alstom (then called Alstom Power Limited) and Mr Sirakas. Alstom was named as the employer. The Detachment Agreement provided that: "[Alstom] detaches the Employee to [APRO] ... in Romania for the period of two (2) years, with a possibility to extend for a third year under agreement of both parties. ... This Agreement is subject to the Employment Agreement of 4 December 1992 which remains in force. The Detachment Agreement applies only for the duration of the detachment. ... The Employee will be working as 'Managing Director ALSTOM Power Romania, Bulgaria, Moldavia'. ... The duties of the Employee shall be executed in Romania, Bulgaria and Moldavia, however, the parties acknowledge that the Employee will be engaged with respect to operations which are international in character and are carried out at places both in Romania and other countries. ... 12. Applicable law and jurisdiction The parties shall be subject to the Labour Law of the Home Country which is Australia, as regards those matters not specifically provided for in this Agreement, and to the extent that it does not contradict mandatory laws of public interest in the Host Country. In the event of dispute the courts of Australia shall have exclusive jurisdiction. " 18On 15 April 2004 Mr Sirakas, Alstom and APRO entered into an agreement called a " Secondment Agreement ". In that agreement Alstom was described as the " Employer ", APRO as " the Company " and Mr Sirakas as the " Employee ". The Secondment Agreement recited: " 1. The Employer and the Employee have entered into an Employment Contract dated as of 1 st April 2004 pursuant to which the Employer, who has employed the Employee as a Managing Director, may at its full discretion, second the Employee hereby to ALSTOM Power Romania SRL, pursuant to the completion of all relevant requisite procedures. " 19The Secondment Agreement provided that Alstom would second Mr Sirakas to APRO and APRO would assign to him the duties of Managing Director in the Power Service Sector of Romania, Bulgaria and Moldavia in conformity with secondment laws applicable in Romania. Clause 3.1 required Mr Sirakas to carry out his duties as managing director in good faith. Clause 11 provided: " 11. Governing law and disputes 11.1. This secondment agreement shall be governed and construed in accordance with the laws of Romania. 11.2. The Courts of Bucharest shall have exclusive jurisdiction to adjudicate over any dispute with respect to the interpretation or application of this agreement. " 20It is evident from recital 1 that the Secondment Agreement and the Detachment Agreement were intended to operate concurrently. APRO was not a party to the Detachment Agreement. Insofar as any dispute arose under the Detachment Agreement, Australian courts were to have exclusive jurisdiction. Insofar as any dispute arose with respect to the interpretation or application of the Secondment Agreement, the courts of Bucharest were to have exclusive jurisdiction. 21Both the Detachment Agreement and the Secondment Agreement were replaced by an agreement called an International Mobility Agreement entered into between Alstom, APRO and Mr Sirakas and dated 21 December 2006. That agreement was expressed to commence on 1 October 2006. Clause 12.1 provided that the agreement should end on 30 September 2008 without any further notice from Alstom or APRO, but that if due to the business needs of APRO Mr Sirakas' assignment to Romania was to extend beyond 30 September 2008, the agreement could be prolonged on the condition that Mr Sirakas' salary would be newly calculated taking the Cost of Living Index fully into account. The International Mobility Agreement also provided for Mr Sirakas to act as Managing Director, Power Service Sector, Romania, Bulgaria and Moldavia in conformity with the laws applicable in Romania. APRO (described as the " Host Company ") promised to assign to Mr Sirakas the duties of Managing Director, Power Service Sector, Romania, Bulgaria and Moldavia. Clause 3.1 of the International Mobility Agreement required Mr Sirakas to carry out his duties in good faith. Clause 15 provided: " 15 Applicable law and jurisdiction 15.1 The parties shall be subject to the Labour Law of the Home Country which is Australia, as regards those matters not specifically provided for in this Agreement, and to the extent that it does not contradict mandatory laws of public interest in the Host Country. 15.2 In the event of dispute the courts of Australia shall have exclusive jurisdiction. " 22On 2 February 2009 APRO and Mr Sirakas entered into a further agreement called a " Mandate Agreement ". It applied to Mr Sirakas' conduct as a director of APRO. The agreement was governed by Romanian law. It provided that in the event of dispute, the dispute would be submitted to arbitration at the Bucharest Arbitration Court of the Romanian Chamber of Industry and Commerce. The agreement applied only from 1 February 2009 (Article 1).

Plaintiffs' claims against Mr Sirakas 23The proceedings were commenced on 8 December 2009. In the statement of claim filed on that date the plaintiffs alleged that Mr Sirakas engaged in fraud and breached duties owed to the plaintiffs in respect of two transactions. These were called the Glina land transaction and the Excitation Generator System. 24The plaintiffs' allegations about the Glina land transaction are that by about the end of 2006 APRO resolved to buy land in the Bucharest area on which to construct a new factory. The plaintiffs allege that Mr Sirakas identified four adjoining allotments of land in the Glina district of Bucharest as a suitable site. They allege that on 25 February 2008 he arranged for APRO to enter into a contract to buy that land from a company called United Media Management SRL ("UMM") for EURO 2,860,000. They allege that thereafter Mr Sirakas facilitated arrangements under which UMM acquired the land to be sold to APRO from four original landowners. The contracts under which UMM is alleged to have acquired land to be sold to APRO are alleged to have been made between 18 April and 16 October 2008. The plaintiffs allege that in April, May and November 2008 Mr Sirakas provided the finance or arranged for APRO to make prepayments to provide UMM with funds to purchase the land to be onsold to APRO. The plaintiffs allege that UMM acquired the land to be onsold to APRO for EURO 1,875,000, a difference of EURO 711,000. The plaintiffs allege that on or about 24 November 2008 UMM paid EURO 400,000 to a company called Eleda Trading FZE for what was purportedly described as " commission ". It is admitted that Mr Sirakas beneficially owns all of the shares in Eleda Trading FZE. 25The plaintiffs propose to tender documents, some of which are said to have been stored on Mr Sirakas' computer that was seized on the termination of his employment which, if admitted, and not explained, would prima facie support those allegations. 26As originally pleaded, the plaintiffs said that APRO had acquired certain machinery known as an Excitation Generator System in April 2003 which was stored in its factory in Bucharest but had not been commissioned, installed or used. The plaintiffs alleged that Mr Sirakas was also president and director of AGT. As originally pleaded it was alleged that by the middle of 2008 AGT concluded that it needed to acquire an Excitation Generator System and APRO concluded that it no longer needed the system, and that Mr Sirakas arranged for APRO to sell the system to General Oltenia SRL (a Romanian company) ("General Oltenia"). The agreement for sale was alleged to have been made on 4 September 2008. The purchase price was EURO 200,000. It was then alleged that Mr Sirakas arranged for AGT to acquire the same system sold by APRO to General Oltenia from a company called Exxcon Development SRL ("Exxcon") for EURO 700,000 and that a contract for that sale was made on 15 September 2008. It was then alleged that on or about 3 January 2009 Exxcon paid Eleda Trading FZE, Mr Sirakas' company, commission of EURO 100,000. It was alleged that Alstom and AGT suffered loss in that it was said that AGT received only EURO 200,000 for a system in fact worth EURO 700,000. It was alleged that Alstom might be liable to indemnify AGT. 27With the defendant's consent the plaintiff has filed an amended statement of claim. In relation to this transaction the plaintiffs now say that Mr Sirakas decided to effect a sale of the system by APRO to a third party for EURO 200,000 and then to effect a purchase of the same system by AGT for EURO 700,000 and did so for the purpose of obtaining a secret profit at the expense of APRO and/or AGT. It is said that rather than the system being worth EURO 700,000, in fact it has no or no significant financial value and that AGT had no need or use for the system. It is not alleged that APRO suffered loss from the transaction. It is alleged that AGT paid EURO 700,000 for a system which had no or no significant financial value and that Alstom may be liable to indemnify AGT. It is alleged that Mr Sirakas is liable to each of the plaintiffs for EURO 700,000 and interest from 15 September 2008 and/or EURO 100,000 and interest from 3 January 2009. 28On 27 July 2010 Mr Sirakas filed a notice of appearance. On 28 July 2010 his solicitors, Verekers Lawyers, served a copy of his defence to the statement of claim. On 23 February 2011 orders were made by consent allowing the plaintiffs to file an amended statement of claim. It was filed on 1 April 2011. The amendments raised seven additional claims to those in the pleading before Palmer J. Four of those claims relate to transactions involving APRO and a Romanian company called SC Ister International Co SRL ("Ister"). They are dealt with in the amended statement of claim under the heading " Ister Transactions ". The plaintiffs allege that the sole shareholder of Ister was a Mr Aurel Rogozea, who is said to be a lawyer engaged in private practice in Bucharest who carried out legal work for APRO and was its in-house legal officer from 29 January 2008. The plaintiffs say that Mr Rogozea was involved in other fraudulent transactions with Mr Sirakas. Some contracts state his address as being the residential address of Mr Sirakas, being a property owned by a company owned and controlled by Mr Sirakas. 29The impugned Ister Transactions are as follows. The plaintiffs say that Ister issued five invoices to APRO between 12 December 2005 and 27 April 2006 for services described as " consultation services " or " design and adjustment model inspection services " or for " documentation " for a particular project for amounts totalling RON326,955 (EURO 93,415). The plaintiffs allege that Mr Sirakas authorised the payments to Ister knowing that the services for which the invoices had been rendered had not been performed and that Ister and Mr Rogozea were not entitled to the payments. These allegations relate to Mr Sirakas' conduct before the commencement of the International Mobility Agreement. 30Another transaction concerning Ister concerns the Bohrwerk machine. The plaintiffs allege that Mr Sirakas procured APRO to enter into a service agreement with Ister under which Ister agreed to upgrade a Bohrwerk drilling machine for EURO 150,000. The contract is alleged to have been entered into on 1 June 2006. The plaintiffs allege that Ister issued an invoice on 20 June 2006 for RON470,000 (EURO 134,285) for an advance payment under the service agreement. The plaintiffs say that Mr Sirakas arranged for that payment to be made to Ister on 22 June 2006. It is said that APRO did not own a Bohrwerk machine which Ister had agreed to service and for which it received advance payment and Mr Sirakas knew this. This allegation also relates to matters allegedly occurring before the commencement of the International Mobility Agreement. 31The plaintiffs say that on 29 August 2008 Ister issued a second invoice to APRO for a further advance payment under the service agreement for RON307,711 (EURO 80,976) and that Mr Sirakas procured payment by APRO to Ister of that sum on the same day. The plaintiffs allege that by this time APRO had purchased a Bohrwerk machine but had not taken possession of it and it remained in the manufacturer's factory. They allege that no work was ever carried out by Ister on the Bohrwerk machine. APRO claims both sums as losses it has suffered. 32Two other impugned Ister Transactions are described as the " House Lease " and the " Car Lease ". In relation to the House Lease, the plaintiffs allege that on 1 March 2006 Mr Sirakas procured APRO to enter into a written lease from Ister of a property in Bucharest owned by a company owned and controlled by Mr Sirakas. The plaintiffs allege that commencing in November 2006 Mr Sirakas procured APRO to pay Ister rent and property taxes for the property. The plaintiffs say that APRO was not obliged to pay rent or reimburse property taxes for the property and Ister had no entitlement to the payments. 33In relation to the Car Lease, the plaintiffs allege that Mr Sirakas had the use of a BMW motor vehicle that was subject to a lease to APRO. They say that APRO had the right to buy the vehicle for a low price at the end of the lease term, but Mr Sirakas procured APRO to assign its interest in the lease of the vehicle to Ister for no consideration. The plaintiffs allege that Ister purchased the car by paying out the residual of EURO 13,000 on 23 January 2006. The plaintiffs allege that commencing November 2006 Mr Sirakas procured APRO to pay Ister rent of EURO 1,500 per month for the vehicle. The plaintiffs allege that APRO lost the value of the vehicle and the difference between the rent it paid Ister and the amount for which it could have purchased the vehicle. 34A further claim raised by the amended statement of claim was called the " Iran Study ". The plaintiffs allege that on or about 3 September 2007 a Dubai company called Eleda Limited issued an invoice to APRO for EURO 162,000 for " services in providing a market study for Iran ". The plaintiffs allege that Eleda Limited is owned and controlled by Mr Sirakas and that Eleda Limited was not entitled to any payment as it had not carried out any such services. The plaintiffs allege that Mr Sirakas knew this, but procured the payment to be made. 35The next claim concerns General Oltenia. The plaintiffs allege that on or about 1 August 2008 Mr Sirakas caused APRO to issue a purchase order to General Oltenia for subcontracting work to the value of RON537,630. The plaintiffs allege that on or about 1 August 2008 General Oltenia issued an invoice to APRO for RON639,779 as an advance payment for the subcontracting work referred to in the purchase order of 1 August 2008. They allege that on or about 8 August 2008 Mr Sirakas authorised or procured a payment by APRO to General Oltenia of RON639,779. They say that General Oltenia did not carry out any subcontracting work for APRO at that time, and neither APRO nor General Oltenia expected that General Oltenia would carry out any such subcontracting work. The plaintiffs' evidence is that the purchase order and invoice was for the supply of emission electrodes, but that after Mr Sirakas' employment with APRO was terminated no record could be found that APRO had ever received the emission electrodes that were to be supplied. APRO wrote to General Oltenia seeking reimbursement of the moneys paid. General Oltenia said that the purchase order had never been issued by APRO, but the " advance " was applied against other agreements between the companies. Settlement discussions were attempted to be arranged for August 2009, but no representative from General Oltenia attended. Since then, no further steps have been taken against General Oltenia. 36The last additional claim raised in the amended statement of claim is headed " Iran Sales ". The plaintiffs allege that in about October 2008 Mr Sirakas became aware that the Tarasht Power Plant in Iran was interested in purchasing certain turbine parts which could be supplied by APRO. The plaintiffs allege that Mr Sirakas procured APRO to sell turbine parts to Eleda Limited for EURO 309,498, but then procured Eleda Limited to sell those parts to the Tarasht Power Plant for EURO 540,564. 37The plaintiffs allege that there were two later transactions in November 2008 of the same kind. That is to say, transactions whereby APRO sold turbine parts to Eleda Limited for EURO 309,498 and Eleda onsold the same parts to the Tarasht Power Plant for EURO 540,564. In the amended statement of claim these transactions are said to have occurred in October and November 2008. The plaintiffs' evidence is that Eleda entered into its contracts with the Tarasht Power Plant on 10 May 2008 and rendered invoices to the Tarasht Power Plant on 18 May 2008. The plaintiffs will tender a ledger from APRO's accounting records listing sales to Eleda between September 2008 and April 2009 totalling EURO 309,498 which are said to be in respect of the same goods sold by Eleda to the Tarasht Power Plant for EURO 540,564. It will tender documents obtained from the hard drive of a computer owned by an APRO employee whose employment was terminated that included an email from the Tarasht Power Plant to Eleda dated 2 August 2008 advising that EURO 191,480 had been deposited to Eleda's account for some of the goods in question. A document said to have been obtained from Mr Sirakas' computer records three transactions for the customer " Tarasht " involving turbine plant for which there was an " Alstom price " of EURO 309,498 and an " Eleda price " of EURO 540,564. The three transactions are said to be dated 31 October, 2 November and 21 November 2007. 38Mr Sirakas' employment was terminated on 24 April 2009.

Significance of the parties' submission to exclusive Australian jurisdiction 39Insofar as the plaintiffs' claim against Mr Sirakas is that they have suffered loss as a result of his alleged conduct, the losses are said to have been sustained by APRO or, in the case of the Excitation Generator System, by AGT. Insofar as Alstom claims anything other than nominal damages for breach of contract, it pleads that it " may be liable to indemnify " APRO or AGT in respect of their losses. 40Alstom has led no evidence and has not pleaded facts to show how it " may be liable " to indemnify APRO and AGT in respect of losses they may have suffered as a result of Mr Sirakas' conduct. On the basis of the plaintiffs' allegations, it is APRO and AGT, but not Alstom, that suffered direct loss. Any moneys recovered from Mr Sirakas would be paid to APRO and AGT in reduction of any sum Alstom might be liable to pay to indemnify APRO and AGT. 41The impugned conduct of Mr Sirakas took place in Romania or in the Middle East. Insofar as the plaintiffs allege the tort of deceit, the law of the tort will be the law of Romania. Romanian law may be " an important aspect of the factual circumstances by reference to which [a New South Wales] court determines whether a fiduciary relationship existed and, if so, the scope and content of the duties to which it gave rise " ( Paramasivam v Flynn [1998] FCA 1711; (1998) 90 FCR 489 at 503; Murakami v Wiryadi [2010] NSWCA 7; (2010) 268 ALR 377 at [132]-[133]). Insofar as the plaintiffs rely on a breach of contract, the law to be applied will be the proper law of the contract. 42No relevant witness is in Australia. The witnesses the plaintiff proposes to call reside in Romania, France and England. It is not known what witnesses the defendant will call. Mr Sirakas has named a large number of potential witnesses. He refers to all those named in connection with the transactions about which the plaintiffs complain. Neither Mr Sirakas nor his solicitor says what evidence might be expected to be called from such persons. The defendant himself is a citizen of Australia. He is also a Greek citizen. He is now resident in Romania. He lived in Australia before departing for Romania. He is divorced from his former wife and does not appear to have any current ties with Australia, except for property owned here. That property consists of the proceeds of sale of land that has been sold by the mortgagee which Mr Sirakas owned with his former wife as tenant-in-common. He is also entitled to superannuation moneys located here. 43If the parties have not submitted to the exclusive jurisdiction of Australian courts, New South Wales would be a clearly inappropriate forum for the determination of this dispute. However, where the parties have agreed that the courts of Australia shall have exclusive jurisdiction in respect of a dispute, it could not be said that New South Wales is a clearly inappropriate forum. On the other hand, where the parties have agreed that the dispute would be determined in Romania, it would require strong grounds not to stay proceedings brought in New South Wales in respect of a dispute the parties agreed should be determined in Romania ( FAI General Insurance Co Ltd v Ocean Marine Mutual Protection and Indemnity Association (1997) 41 NSWLR 559 at 569). 44Accordingly, the application and scope of the submissions to Australian or Romanian jurisdiction in the Detachment Agreement, the Secondment Agreement, the International Mobility Agreement and the Mandate Agreement, are critical.

What disputes are subject to submission to exclusive jurisdiction of Australian courts? 45The scope of the submission to jurisdiction of the Australian or Romanian courts depends upon the proper construction of the text of the clauses, which is to be determined by how the parties as reasonable people would intend the clauses to operate. This requires consideration of the text of the clauses, as well as the purpose and object of the transaction, and the circumstances known to the parties ( Pacific Carriers Ltd v BNP Paribas [2004] HCA 35; (2004) 218 CLR 451 at [22]). By analogy with contracts that provide for the submission of disputes to arbitration, a liberal approach to construction should be taken. In Comandate Marine Corp v Pan Australia Shipping Pty Ltd [2006] FCAFC 192; (2006) 157 FCR 45; (2006) 238 ALR 457 Allsop J (as his Honour then was) said (at [165]): " [165] This liberal approach is underpinned by the sensible commercial presumption that the parties did not intend the inconvenience of having possible disputes from their transaction being heard in two places. This may be seen to be especially so in circumstances where disputes can be given different labels, or placed into different juridical categories, possibly by reference to the approaches of different legal systems. " 46APRO was not a party to the Detachment Agreement. That agreement was made on 1 April 2004 and applied to the detachment of Mr Sirakas to APRO commencing from 1 October 2003. It specified Mr Sirakas' entitlements to salary, other payments and benefits and provided for his position, title and lines of reporting. It provided that he would execute his duties in Romania, Bulgaria and Moldavia, but otherwise did not describe his duties. The Detachment Agreement described Mr Sirakas as the employee of Alstom and provided that it was subject to his employment agreement of 4 December 1992 which remained in force. The submission to the exclusive jurisdiction of Australian courts is contained in clause 12 quoted at para [17] above. As neither APRO nor AGT is a party to the Detachment Agreement, they could not rely on clause 12. In any event, there is an inconsistent submission to jurisdiction in the later Secondment Agreement. Even though both agreements were to operate concurrently, the Secondment Agreement made more specific provision in relation to Mr Sirakas' duties. A dispute in relation to the performance of those duties would be covered by clause 11 of the Secondment Agreement. 47The Secondment Agreement was made on 15 April 2004. APRO was a party to it. It provided for the courts of Bucharest to have " exclusive jurisdiction to adjudicate over any dispute with respect to the interpretation or application of this agreement ". It was described as an " additional act to the Employment Contract of 1 st April 2004 " between Mr Sirakas and Alstom. The Secondment Agreement recited that " the Employer [Alstom] and the Employee [Mr Sirakas] have entered into an Employment Contract dated as of 1 st April 2004 pursuant to which the Employer, who has employed the Employee as Managing Director, may at its full discretion, second the Employee hereby to [APRO] , pursuant to the completion of all relevant requisite procedures ". Clauses 1, 2 and 3 provided: " 1. Scope of the Agreement 1.1 The Employer shall second, through this additional act to the Employment Contract of 1 st April 2004 hereinafter referred to as 'Secondment Agreement', for the term agreed upon hereby, the Employee to the Company and the Company shall assign to the Employee the duties of Managing Director Power Service Sector Romania, Bulgaria and Moldavia. 1.2 This Secondment Agreement shall not set aside the effect and validity of the contract between the Employer and the Employee. ... 2. Location and Assignment Duties Host Country: Romania Location: Bucharest The Employee seconds, through this Secondment Agreement, the Employee to act as Managing Director Power Service Sector Romania, Bulgaria and Moldavia, in conformity with the secondment laws applicable in Romania. The Employee undertakes to perform in the Host Country duties falling within the scope of his skills and experience that may be required in accordance with the Employer's and the Company's instructions, the Constitutive Act of the Employer, the Services Agreement, the Constitutive Act of the Company and the Resolutions of the Board of Directors of the Company. 3. Obligations of the Employee 3.1. The Employee shall carry out his duties as managing Director Power Service Sector Romania, Bulgaria and Moldavia in good faith and in accordance with the laws, the Constitutive Act of the Company, the Resolutions of the Board of Directors of the Company, all the internal rules and regulations of the Company, and the objectives to be set by ALSTOM Power Service Region 2 Senior VP. 3.2. The Employee shall devote the whole of his working time in the performance of his duties as Managing Director power Service Sector Romania, Bulgaria and Moldavia of the Company and will not, during the validity of this secondment, have any other employment agreement in Romania. 3.3. During the period of this secondment the Employee shall be prohibited from exercising directly or in the name of any of his family members (1 st degree) any activity in direct competition with the activities of the Company, its affiliates and its subsidiaries, without the prior written consent of the Company. 3.4. The Employee shall move to Bucharest/Romania, where the head-office of the Company is situated and shall travel anywhere in the world as the Company's and/or Employer's obligations may require. The Employee must be physically present at [APRO] on 15 th April 2004. " 48The Secondment Agreement was to continue in full force and effect until 15 April 2005 and thereafter could be renewed each 12 months if APRO's projects required Mr Sirakas' presence for a longer period (clause 9). The agreement was to be governed by and construed in accordance with the laws of Romania. By clause 11 (quoted at para [19] above) the courts of Bucharest were to have exclusive jurisdiction over any dispute with respect to the interpretation or application of the agreement. 49If the Secondment Agreement has any continued operation, then, to the extent that APRO claims damages or an account of profits against Mr Sirakas for alleged acts of misfeasance during the period of the Secondment Agreement, the dispute should be determined by the courts of Bucharest. Whether the claim is framed in the tort of deceit, for breach of fiduciary duty, or for breach of the contractual duty to act in good faith towards APRO, it is a dispute with respect to the application of the Secondment Agreement. The words " with respect to " are wide. As the Secondment Agreement required Mr Sirakas to carry out his duties as managing director of APRO in good faith, and as the statement of claim alleges a breach of that duty, the dispute is with respect to the application of the Secondment Agreement. The fact that there are other causes of action alleged arising out of the same facts is neither here nor there. The whole of the dispute to which the Secondment Agreement applies would be subject to the exclusive jurisdiction of the courts of Bucharest. 50The Secondment Agreement was replaced by the International Mobility Agreement. Clause 12.1 of the International Mobility Agreement provided that it took effect from 1 October 2006. The International Mobility Agreement also provided that Mr Sirakas was the employee of Alstom who had been seconded as managing director of APRO. The International Mobility Agreement was also described as a temporary additional act to the employment contract between Alstom and Mr Sirakas of 4 December 1992. Clause 1.2 of the International Mobility Agreement provided: " 1.2 This Agreement replaces the 'Detachment Agreement', signed April 1, 2004 and the 'Secondment Agreement' signed April 14, 2004 and any other written or oral agreement regarding this International Assignment. They will no longer be applicable or any rights can be derived thereof. " 51If the first sentence of clause 1.2 stood alone, the parties' rights and obligations under the Secondment Agreement would be replaced prospectively from 1 October 2006. This would not affect Mr Sirakas' entitlement to have a dispute arising from the allegations that he misconducted himself during the currency of the Secondment Agreement being referred to adjudication by the courts of Bucharest. Clauses providing for the submission of disputes to arbitration or adjudication by specified courts usually survive the termination or avoidance of a contract ( FAI General Insurance Co. Ltd v Ocean Marine Mutual Protection and Indemnity Association ; Mackender v Feldia AG [1967] 2 QB 590). But the clear intention of the second sentence of clause 1.2, although clumsily expressed, is that after the commencement of the International Mobility Agreement, no party could derive any rights from the Secondment Agreement. But for the International Mobility Agreement, Mr Sirakas would have the right to have a dispute in relation to the application of the Secondment Agreement decided by the courts of Bucharest. The second sentence of clause 1.2 of the International Mobility Agreement extinguished that right. It also follows, as counsel for Mr Sirakas submitted, that if the parties could derive no rights from the Secondment Agreement, Alstom and APRO could not claim damages for breach of that agreement. 52However, and contrary to the submission of Mr Harris SC for the plaintiffs, clause 1.2 of the International Mobility Agreement does not have the effect that the International Mobility Agreement operates retrospectively beyond the express provision in clause 12.1 that that agreement took effect from 1 October 2006. That would contradict clause 12.1. 53Clause 1.2 does not mean that the parties are taken to have agreed to submit all disputes with respect to the application of the Secondment Agreement to the exclusive jurisdiction of Australian courts. Rather, it means that the previous submission to the jurisdiction of the courts of Bucharest was rescinded. 54APRO was a party to the International Mobility Agreement. Clause 3 of that agreement provided: " 3 Obligations of the Employee 3.1 The Employee shall carry out his duties as Managing Director Power Service Sector Romania, Bulgaria and Moldavia in good faith and in accordance with the laws, the Constitutive Act of the Host Company the Resolutions of the Board of Directors of the Host Company, all the internal rules and regulations of the Employer and the Host Company and the objectives to be set by the Managing Director sub-region South East Europe. 3.2 The Employee shall devote the whole of his working time in the performance of his duties as Managing Director Power Service Sector Romania, Bulgaria and Moldavia of the Host Company and will not, during the validity of this secondment, have any other employment agreement in Romania or any other country. 3.3 During the period of this secondment the Employee shall be prohibited from exercising directly or in the name of any of his family members (1 st degree) any activity in direct competition with the activities of the Employer or the Host Company, its affiliates and its subsidiaries, without the prior written consent of the Employer and the Host Company. " 55Clause 15 provided: " 15 Applicable law and jurisdiction 15.1 The parties shall be subject to the Labour Law of the Home Country which is Australia, as regards those matters not specifically provided for in this Agreement, and to the extent that it does not contradict mandatory laws of public interest in the Host Country. 15.2 In the event of dispute the courts of Australia shall have exclusive jurisdiction. " 56Clause 15.2 is perfectly general. It applies to any dispute between the parties. The submission to the exclusive jurisdiction of the Australian courts is not confined to disputes governed by Australian law. Nor is it confined to allegations that there has been a breach of the International Mobility Agreement. The principles referred to in para [45] above apply. All of the disputes arising from the allegations made by Alstom and APRO of misconduct against Mr Sirakas during the currency of the International Mobility Agreement are submitted to the exclusive jurisdiction of the Australian courts. That is so irrespective of how the cause of action is framed, that is, whether in breach of the International Mobility Agreement, or in breach of fiduciary duty, or in tort, or otherwise. 57However, because the International Mobility Agreement does not operate retrospectively before 1 October 2006, a dispute arising from Mr Sirakas' conduct before that date is not subject to the submission to the exclusive jurisdiction of Australian courts. 58The next question is for how long the International Mobility Agreement remained on foot. Mr Harris SC submitted that it continued until the termination of Mr Sirakas' employment on 24 April 2009. 59Clause 12.1 of the International Mobility Agreement relevantly provided: " 12 Term and Termination 12.1 This Agreement shall enter into force on 1 st October 2006 and end on 30 September 2008 without any further notice from the Employer or the Company. If due to business needs of the Company, the assignment to Romania will take longer than this, this Agreement can be prolonged under the condition, that the salary will be newly calculated ...". 60Under clause 12.1, the agreement was to come to an end on 30 September 2008 unless the parties took some act to prolong it. A condition of prolongation of the agreement was that Mr Sirakas' salary be recalculated. Under clause 13.1 Mr Sirakas was to return for redeployment with Alstom as per his employment contract of 4 December 1992 " at the end of this Agreement ". Mr Sirakas did not return for redeployment. He continued in his role at APRO. There was no evidence as to whether Mr Sirakas' remuneration was recalculated from 30 September 2008. 61Mr Sirakas' salary was recalculated on the entry into the Mandate Agreement with APRO dated 2 February 2009. Under the International Mobility Agreement he was to be paid a salary in Australian dollars split up into a base salary and into a secondment indemnity. Under the Mandate Agreement with APRO he was to be paid annual remuneration in Romanian currency. The Mandate Agreement dealt with the same subject matter as the International Mobility Agreement, although in some respects it did so in greater detail. 62The only evidence that the parties took some act to prolong the International Mobility Agreement was that Mr Sirakas did not return to Australia for redeployment with Alstom, but continued in the same role at APRO. That is equivocal. The parties may have intended to prolong the International Mobility Agreement. They may have intended that Mr Sirakas be employed under an oral or implied contract. They may not have noticed that the International Mobility Agreement had expired. 63There is no evidence that Mr Sirakas' salary was recalculated before 2 February 2009. There is no evidence that the parties addressed the question of whether the International Mobility Agreement was to be extended. As a different agreement was made some months later I would not infer that the parties agreed to the extension of the International Mobility Agreement. It is at least equally probable that they did not address the question, but that things simply carried on, with Mr Sirakas continuing to work as managing director of APRO. As the International Mobility Agreement provided for its own termination unless the parties took some positive step to prolong it, it cannot be inferred that it was prolonged merely because Mr Sirakas continued in his existing role. He may have done so under an implied contract that did not incorporate all of the terms of the International Mobility Agreement. 64On the limited evidence adduced on this application, I conclude that the International Mobility Agreement, including the parties' submission to the exclusive jurisdiction of Australian courts, terminated on 30 September 2008. 65Article 9.2 (incorrectly numbered 7.3) of the Mandate Agreement provided: " The Parties undertake to attempt and amicably settle any disagreement which may occur as a result of this agreement. If the Parties fail to reach an amicable solution to such a dispute within 30 days of the occurrence thereof, the dispute shall be submitted by either Party for arbitration at the Bucharest Arbitration Court of the Romanian Chamber of Industry and Commerce, in compliance with the arbitration rules and procedures, except for the cases which as per the Company Law can only be settled in a court of law. " 66Any dispute that arose from things done or events occurring after 2 February 2009 between Mr Sirakas and APRO are to be submitted to arbitration in Bucharest, but only where the dispute occurs " as a result of " the Mandate Agreement of 2 February 2009. There is no such dispute falling within that submission.

Validity of the International Mobility Agreement under Romanian Law 67Mr Scotting, who appeared with Mr Chapple for Mr Sirakas, submitted that the International Mobility Agreement either did not become operative or, if it did, it ceased to have any force from 29 June 2007. Counsel pointed to clause 1.3 of the International Mobility Agreement that provided: " 1.3 The Employer seconds, through this Agreement, the Employee to act as Managing Director Power Service Sector Romania, Bulgaria and Moldavia, in conformity with the secondment laws applicable in Romania. " 68Mr Scotting submitted that the International Mobility Agreement was not in conformity with the secondment laws applicable in Romania. In their written submissions, counsel contended that by Romanian law, Mr Sirakas was not permitted to be an employee of either APRO or AGT from 17 November 2004, and this had the effect that any employment contract with him was suspended from that date. Counsel also submitted that the contract was terminated by reason of a Government Emergency Ordinance that took effect from 29 June 2007. 69There was no dispute that if the International Mobility Agreement was terminated, suspended or invalidated under Romanian law the parties ceased to be bound by it. Only the " Labour Law " of New South Wales or Australia was selected as part of the proper law of the contract, and only then in so far as it did not contract a mandatory law of Romania. The Romanian laws relied on were mandatory. 70In support of these submissions the defendant tendered English translations of the Labour Code Law of Romania No. 53/2003, Articles 70, 72 and 137 of Law 31/1990 of Romania, and Article 5 of the Government Emergency Ordinance No. 82 of Romania. There was no dispute about the translations. The evidence was admissible pursuant to s 174 of the Evidence Act 1995. However, no evidence was led from any person expert in Romanian law about the effect of these statutes and ordinances. No evidence was led from an expert in Romanian law as to the effect and operation of the Romanian laws referred to on the relationship between the parties, or their effect on the International Mobility Agreement in general, or the submission to the exclusive jurisdiction of Australian courts in particular. In Lazard Bros & Co v Midland Bank Limited [1933] AC 289, Lord Wright said (at 298) that the question in a case such as the present is not as to the language of the foreign code, but what it means when applied to the circumstances of the particular case or, as Lord Wright put it more elegantly, " what the law is as shown by its exposition, interpretation and adjudication ". 71There is no such evidence in this case. Mr Harris SC, who appears for the plaintiffs, submits that for this reason the plaintiffs have failed to make good their contention that the submission to jurisdiction in the International Mobility Agreement did not come into effect, or that the agreement ceased to be in force from 28 June 2007. Mr Scotting and Mr Chapple submitted that the adducing of evidence of Romanian law by the tender of the written laws placed an evidentiary onus on the plaintiffs to adduce expert evidence if the written Romanian laws did not have the effect appearing from their text. They submitted that where no expert opinion evidence was led, the court can and should examine the text for itself to arrive at a conclusion upon the questions of foreign law. In Williams v Usher [1955] HCA 60; (1955) 94 CLR 450 the High Court held that where no expert evidence was called, the court was at liberty to decide the question of foreign law by itself looking at the relevant enactment (at 453-454; see also F & K Jabbour v Custodian of Israeli Absentee Property [1954] 1 WLR 139 at 147-148). 72I agree with the defendant's submission that the court can decide the question of foreign law by itself construing the relevant enactments. Where there is no expert evidence of Romanian law, that course is unavoidable. The content and application of foreign law is a question of fact. I do not interpret the text of the Romanian laws that were tendered as having the effect for which Mr Sirakas contended. 73The Labour Code is a law published in the official gazette of Romania of 5 February 2003. Article 1 provides that the Code regulates, amongst other things, all individual labour relations. Article 2(c) provides that the provisions in the Code apply to foreign citizens employed under an individual labour contract to work for a Romanian employer on the territory of Romania. 74Article 10 describes what is an individual labour contract. It provides: " Article 10. - An individual labour contract is a contract based on which a natural entity, called employee , undertakes to perform work for and under the authority of an employer, who is a natural or legal entity, in return for a remuneration, called wages . " 75Articles 45 to 47 deal with secondment. Article 45 provides: " Article 45. - The secondment is the action whereby a temporary change in the work place is provided for, based on the employer's order, with another employer, for the purpose of performing some works in the latter's interest. In this exceptional case, a secondment can also mean a change in the kind of work, but only based on the employee's written consent. " 76Under Article 46 a secondment can be ordered for a period not exceeding one year. In an exceptional case the period of secondment can be extended " for objective reasons requiring the employee's presence with the employer who ordered the secondment, based on both parties' consent, every six months. " Article 47(1) provides: " Article 47. - (1) The employer with whom the secondment has been ordered shall grant the rights due to the seconded employee. " 77Article 56 sets out the circumstances in which an individual labour contract is "de jure terminated ". These include the expiry of the deadline of the individual labour contract concluded for a definite term. 78Counsel for Mr Sirakas submitted that the International Mobility Agreement is an individual labour contract within the meaning of the Code. 79There are provisions in the Labour Code that are said to be inconsistent with certain of the terms of the International Mobility Agreement, namely terms requiring confidentiality and requiring Mr Sirakas to work exclusively for APRO. It is unnecessary to consider whether there is the suggested inconsistency because Mr Sirakas is not sued for breach of those terms. It could not be said that any inconsistency between those terms and the Labour Code renders the whole International Mobility Agreement void. Nor was that argued. 80Instead, counsel for Mr Sirakas relied on two laws concerning labour contracts made between " administrators " and the company of which they are administrator. There was evidence from a Mr Chevrier, who described his occupation as " Alstom Country President Romania, Bulgaria, Moldavia ", that in Romania a person who would be considered as the manager of an Australian company is called a director and that a person who would be considered a director of an Australian company is called an " administrator ". Counsel for Mr Sirakas rely on Articles 70, 72 and 137 of Law No. 31/1990 regarding companies. Those Articles provide: " Art. 70. - (1) The administrators shall perform all operations necessary for the fulfilment of the company's scope of activity, except for the restrictions provided under the constitutive deed. ... Art. 72. - The obligations and the liability of the administrators are regulated by the provisions regarding the mandate and especially by those provided under this law. ... Art. 137. - (1) The administrators are designated by the ordinary general meeting of the shareholders, except for the first administrators, who are appointed by the constitutive deed. (2) The candidates for the offices of administrator are nominalised by the current members of the board of administration or by the shareholders. (3) During the term of the mandate, the administrators cannot conclude with the company a labour contract. If the administrators have been designated from the company's employees, the individual labour contract shall be suspended during the term of the mandate. (4) The administrators can be revoked at any time by the ordinary general shareholders' meeting. If the revocation is done without a just cause, the administrator shall be entitled to damages. " 81It seems that Article 137 was an amendment to Law No. 31/1990 published on 17 November 2004. Counsel submit that by Article 137(3) the International Mobility Agreement was suspended during the term for which Mr Sirakas had the mandate to act as administrator of APRO. 82Counsel also referred to Article V of Government Emergency Ordinance No. 82 that amended Law No. 31/1990 as from 29 June 2007. Article V provided: " Art. V. - By derogation from the provisions of art. 56 of the Law no. 53/2003 - the Labour Code, with its subsequent amendments and completions, the labour contracts of the administrators/directors, concluded for performing the mandate of administrator/director before the [entrance] into force of this emergency ordinance are terminated de jure at the date of entrance into force of this emergency ordinance or, if such mandate was accepted after the entrance into force of this ordinance, at the date of the acceptance of the mandate. " 83Counsel submitted that the effect of this Article is that the International Mobility Agreement, being a labour contract, was terminated de jure as from 29 June 2007. 84Hence, it was said that the parties' submission in the International Mobility Agreement to the exclusive jurisdiction of courts of Australia was never operative because the contract was suspended, and in any event terminated by operation of law as from 29 June 2007. 85This submission does not explain what were the terms upon which Mr Sirakas was to act as managing director of APRO if not those in the International Mobility Agreement. Presumably he was entitled to be paid by someone for his services and presumably he undertook some obligations to perform the services. Articles 72 and 137 of Law No. 31/1990 refer to a mandate which regulates the obligations of an administrator. If Mr Sirakas was an administrator of APRO, what were the terms of the mandate, unless those contained in the International Mobility Agreement? 86The submission depends upon the International Mobility Agreement being an individual " labour contract ". Reference to the Labour Code suggests that the contract was only a labour contract if APRO was Mr Sirakas' employer. I was referred to no material which showed how Romanian law defined the relationship of employer and employee. The International Mobility Agreement, like the Secondment Agreement and the Detachment Agreement before it, provide for Alstom, not APRO, to be Mr Sirakas' employer, but for him to be seconded to provide services to APRO as its managing director. 87Counsel for Mr Sirakas rely on clause 1.3 of the International Mobility Agreement that Mr Sirakas was to act as " Managing Director Power Service Sector Romania, Bulgaria and Moldavia, in conformity with the secondment laws applicable in Romania ". Counsel submit that this refers to Article 45 which describes a secondment as an action whereby an employee is placed to work with another employer for the purpose of performing works in another employer's interest. Similarly, Article 47 describes a person with whom the employee has been seconded as being that person's employer and required to grant rights due to the seconded employee. Hence it is said that as the secondment was to be in conformity with Romanian secondment laws, Mr Sirakas is to be regarded as an employee of APRO. Hence the contract is a labour contract that is derived of effect by Law No. 31/1990. 88I have not been provided with a full picture of Romanian law as it bears on this question. I have been provided with a few sections of Law No. 31/1990 on the functioning of companies without any guidance or explanation as to how those sections are to apply to an executive director (administrator) who is also an employee. 89The Labour Code gives various rights to employees that cannot be contracted out of and also stipulates certain requirements for labour contracts. For example, by Articles 27 and 28 an employee must have a satisfactory medical certificate before he or she can be employed. Otherwise the individual labour contract is null (Article 27). If a labour contract is to include a clause against competition, the parties are required to negotiate an allowance to the employee of at least 25 per cent of the wages in return for such a restraint (Article 21). If an individual labour contract contains a " mobility clause " where the employee is to perform his or her job not in a stable workplace, the employee must be given unspecified additional cash payments or payments in kind (Article 25). There are restrictions on the right of an employer to dismiss an employee (Articles 58-72). Employees are guaranteed annual holidays of at least 20 working days (Article 140) in addition to ten days of " legal holidays " (Articles 134 and 140). An employee is entitled on request to vocational training leave (Article 149). There are to be minimum guaranteed wages (Article 159). Employers are required to ensure the employees have access to certain medical services (Articles 182-187). 90I infer that the purpose of Article 137 of the Law No. 31/1990 when read with Article 72 is that those who are in charge of companies (called administrators) are required to act in accordance with what is called a mandate, and are not permitted to act under what is characterised as an individual " labour contract ". In that way administrators cannot make the company subject to the operation of the Labour Code so far as their own position is concerned. In other words, they cannot claim the benefit of the Labour Code. But I do not infer that it follows that no contract can be made between an administrator and the company for his or her employment. Clearly there is to be a thing called a " mandate " which it could be expected would set out what an administrator was expected or required to do and the terms on which he or she was to act, including terms providing for remuneration. I see no reason that the International Mobility Agreement, and the Secondment Agreement before it, would not contain the terms of that mandate. The agreement is suspended only insofar as it operated as a labour contract that would be subject to the Labour Code. On the materials provided to me, if this were not so, there would be no way of ascertaining what rights Mr Sirakas had, or what obligations he owed. 91In this respect the Mandate Agreement made by Mr Sirakas with APRO on 2 February 2009 is instructive. In that agreement Mr Sirakas was described as the " Director ". Article 1 provided: " Appointment The Director was appointed and informed of his duties required for the working of the Company, and for performing any other related operations, in compliance with the terms and conditions of this agreement, in observance of the provisions in the By-laws and in the Company Law no. 31/1990, as subsequently amended (hereinafter referred to as 'Company Law') for a period of 2 years and 11 month [s] , until 31 st December 2011. The Director acknowledges and accepts this appointment and empowerment. " 92In other words, the draftsman of the Mandate Agreement considered that the agreement was being made in conformity with Law No. 31/1990. The agreement went on to provide for the duties that Mr Sirakas was to carry out on behalf of APRO, including his obligation to carry out duties as Managing Director Power Services Sector Romania, Bulgaria and Moldavia in good faith. It set out his powers and remuneration. It provided that it could be terminated by either party on three months' notice and contained a submission of the parties to submit any dispute that might occur as a result of that agreement to arbitration in Romania. 93I infer that this was not intended to be a " labour contract " because Article 137(3) would preclude Mr Sirakas and APRO from concluding such a contract. Thus the provisions of the Labour Code would not apply to it. But that does not mean that the contract would not be enforceable according to its terms. 94Article V published on 29 June 2007 terminated " de jure " labour contracts of administrators/directors that were concluded " for performing the mandate of administrator/director ". The mandate itself was not terminated, but only a labour contract concluded for the purpose of performing it. Considered as a labour contract to which the Labour Code would apply, the International Mobility Agreement ceased to be of effect. That did not mean that it became wholly void. It simply meant that it did not operate as a labour contract to which the Labour Code applied. It continued to have contractual force as setting out the terms of the mandate under which Mr Sirakas was to provide his services. He remained entitled to the remuneration and allowances provided for in the agreement, but he could not seek protection of the Labour Code. He remained bound by the submission to the jurisdiction of Australian courts. 95It is unfortunate that there was no expert evidence of Romanian law on this question. As the argument that the International Mobility Agreement, including the submission to jurisdiction clause, did not come into effect or was terminated by operation of law was advanced for the defendant, I would have expected the defendant to adduce expert evidence of Romanian law on this question. I can infer that no further evidence the defendant could have called on this question would have assisted his case. I do not think that the tender of the translations of Articles of Law No. 31/1990 imposed an evidentiary onus on the plaintiffs to call evidence on the topic. For the reasons I have given I do not construe the laws that were tendered as having the result for which counsel for Mr Sirakas submitted.

Conclusion as to New South Wales being a clearly inappropriate forum 96Accordingly, I conclude that between 1 October 2006 and 30 September 2008 Alstom, APRO and Mr Sirakas were parties to a contract that provided that the Australian courts would have exclusive jurisdiction in the event of dispute. In my view, that clause applied to disputes arising from things done or events occurring during the currency of the contract. The clause remained operative after termination of the contract in respect of disputes arising from things done or events occurring during its currency. 97I have concluded that there is no operative submission to the jurisdiction of either Romanian courts or Australian courts in respect of disputes arising from things done or events occurring prior to 1 October 2006 or after 30 September 2008 and prior to 2 February 2009. The prior submission to the jurisdiction of the Romanian courts in the Secondment Agreement was rescinded by the International Mobility Agreement. The later submission in the Mandate Agreement did not become applicable to the present dispute. 98The plaintiffs' claims arising before 1 October 2006 that are not the subject of the parties' submission to the exclusive jurisdiction of Australian courts are first, the claim of AGT for the losses it claims to have suffered in respect of the payment of EURO 700,000 for the Excitation Generator System. AGT was not a party to the International Mobility Agreement. 99Secondly, APRO's claims in relation to the first of the impugned Ister Transactions, being payments for invoices rendered between 12 December 2005 and 27 April 2006 for services allegedly not provided, pre-date the commencement of the International Mobility Agreement. Thirdly, the claim that Mr Sirakas procured APRO to enter into the service agreement for Ister to upgrade a Bohrwerk drilling machine and authorised an advance payment to Ister on 22 June 2006 are matters alleged to have occurred before the commencement of the International Mobility Agreement. (The later complaint in relation to payment to Ister for work said never to have been carried out on the Bohrwerk machine post-dates the commencement of the International Mobility Agreement.) Fourthly, parts of the car lease and house lease claims pre-date the commencement of the International Mobility Agreement. 100Some transactions span the date the International Mobility Agreement expired. Thus, part of the purchase price of the Glina land and the payment of so-called commission is alleged to have been paid after 30 September 2008. But according to the plaintiffs' allegations (for which there is prima facie evidence), the steps to implement that transaction were taken prior to 30 September 2008. 101The same is true of the allegations relating to the Excitation Generator System. The commission of EURO 100,000 was paid on 3 January 2009, but the sale to General Oltenia and on-sale to AGT took place prior to 30 September 2008. 102On the other hand, the sale of turbine parts to the Tarasht Power Plant in Iran via Eleda is alleged to have occurred from October 2008. 103A substantial number of the claims of the plaintiffs raise disputes arising from things allegedly done by Mr Sirakas and events occurring during the currency of the International Mobility Agreement, which are subject to the submission to the exclusive jurisdiction of Australian courts. 104The question then is whether New South Wales is a clearly inappropriate forum for the determination of those disputes that are not the subject of the submission to the exclusive jurisdiction of Australian courts. 105If those claims stood alone, then New South Wales would be a clearly inappropriate forum. But New South Wales is not a clearly inappropriate forum where the remaining claims are to be litigated here. In the case of the Excitation Generator System, APRO's claim to recover the commission of EURO 100,000 said to have been paid to a Eleda Trading FZE is to be litigated here because the contracts for sale and on-sale were entered into during the currency of the International Mobility Agreement. The same analysis is true of the Glina land transaction. It is not clearly inappropriate that all claims in relation to those transactions be litigated in the one forum. Similarly, in the case of payments allegedly made to Ister in relation to invoices for services provided in relation to the Bohrwerk machine, where APRO alleges that no work was done, the claim in relation to the later invoice of 29 August 2008 is subject to the parties' submission to the exclusive jurisdiction of Australian courts. In those circumstances it is not clearly inappropriate that the same forum determine the similar earlier claim in relation to a payment said to have been made on 22 June 2006. 106The same degree of interconnection is not demonstrated in relation to the first of the Ister claims, namely those relating to invoices between 12 December 2005 and 27 April 2006 for services that were allegedly not provided. Nor is there the same degree of interconnection in relation to the Iran sales claim. Nonetheless, given the other claims that are to be litigated between the same parties, New South Wales is not a clearly inappropriate forum. To the contrary, it is desirable that the parties not be put to the expense and trouble of litigating in two jurisdictions. 107For these reasons I refuse the application that the proceedings be stayed or dismissed on the ground that New South Wales is clearly an inappropriate forum.

Pending criminal investigations 108It was common ground that the discretion whether to stay proceedings on the basis of pending criminal investigations in Romania was to be exercised in accordance with the guidelines stated by Wootten J in McMahon v Gould (1982) 7 ACLR 202 at 206-207. His Honour said: " (a) Prima facie a plaintiff is entitled to have his action tried in the ordinary course of the procedure and business of the court ( Rochfort v John Fairfax & Sons Ltd at 19); (b) It is a grave matter to interfere with this entitlement by a stay of proceedings, which requires justification on proper grounds ( ibid ); (c) The burden is on the defendant in a civil action to show that it is just and convenient that the plaintiff's ordinary rights should be interfered with ( Jefferson v Bhetcha at 905); (d) Neither an accused ( ibid ) nor the Crown ( Rochfort v John Fairfax & Sons Ltd at 21) are entitled as of right to have a civil proceeding stayed because of a pending or possible criminal proceeding; (e) The court's task is one of 'the balancing of justice between the parties' ( Jefferson Ltd v Bhetcha at 904), taking account of all relevant factors ( ibid at 905); (f) Each case must be judged on its own merits, and it would be wrong and undesirable to attempt to define in the abstract what are the relevant factors ( ibid at 905); (g) One factor to take into account where there are pending or possible criminal proceedings is what is sometimes referred to as the accused's 'right of silence', and the reasons why that right, under the law as it stands, is a right of a defendant in a criminal proceeding ( ibid at 904). I return to this subject below; (h) However, the so-called 'right of silence' does not extend to give such a defendant as a matter of right the same protection in contemporaneous civil proceedings. The plaintiff in a civil action is not debarred from pursuing action in accordance with the normal rules merely because to do so would, or might, result in the defendant, if he wished to defend the action, having to disclose, in resisting an application for summary judgment, in the pleading of his defence, or by way of discovery or otherwise, what his defence is likely to be in the criminal proceeding ( ibid at 904-5); (i) The court should consider whether there is a real and not merely notional danger of injustice in the criminal proceedings ( ibid at 905); (j) In this regard factors which may be relevant include: (i) the possibility of publicity that might reach and influence jurors in the civil proceedings ( ibid at 905); (ii) the proximity of the criminal hearing ( ibid at 905); (iii) the possibility of miscarriage of justice eg by disclosure of a defence enabling the fabrication of evidence by prosecution witnesses, or interference with defence witnesses ( ibid at 905); (iv) the burden on the defendant of preparing for both sets of proceedings concurrently (Beecee Group v Barton ); (v) whether the defendant has already disclosed his defence to the allegations ( Caesar v Somner at 932; Re Saltergate Insurance Co Ltd at 736); (vi) the conduct of the defendant, including his own prior invocation of civil process when it suited him (cf Re Saltergate Insurance Co Ltd at 735-6); (k) The effect on the plaintiff must also be considered and weighed against the effect on the defendant. In this connection I suggest below that it may be relevant to consider the nature of the defendant's obligation to the plaintiff; [l] In an appropriate case the proceedings may be allowed to proceed to a certain stage, eg, setting down for trial, and then stayed Beecee Group v Barton ). " 109Criminal investigations have been commenced in Romania in relation to the Bohrwerk machine and the Excitation Generator System. 110Mr Sirakas informed Ms Katelin Turner, a solicitor employed by Mr Sirakas' solicitors, that shortly after his return to Romania on or about 12 March 2010, he located in mail sent to his former address in Romania, a summons to attend a police station in Bucharest to be interviewed in relation to a complaint made by APRO. The summons required Mr Sirakas to attend at the police department in Bucharest on 3 June 2009. There is no evidence that the police had taken any action following 3 June 2009 in relation to Mr Sirakas' non-attendance at the police station on 3 June 2009. 111Mr Sirakas informed Ms Turner that he was served with a summons to attend the police station on or about 30 March 2010. At the time of service of that summons the police officer spoke to Mr Sirakas' lawyer in Romania and arrangements were made for him to attend the police station on 1 April 2010. Mr Sirakas informed Ms Turner that at that meeting, Commissioner Rusanu of the Romanian police, informed Mr Sirakas that the police were investigating a number of allegations made on behalf of APRO as follows: " (a) that the Defendant accepted a commission of EUR 400,000 from SC United Media Management SRL in relation to the acquisition of land at Glina by the second plaintiff; (b) that the Defendant arranged for the second plaintiff to pay more than a fair and reasonable price for the land at Glina; (c) that the Defendant accepted a commission of EUR 100,000 from SC Exxon Developments SRL in relation to the sale of an excitation generator system by the second defendant; (d) that the Defendant fraudulently approved the payment of an invoice in the sum of EUR 50,000 issued by SC Ister SRL for maintenance work done on machinery owned by the second plaintiff, when he knew that no work had been performed on that machinery; (e) that the Defendant accepted a commission of EUR 182,000 from SC Cons Co SRL in relation to the design of the new factory at Glina; (f) that the Defendant arranged for the second plaintiff to pay sums that were not fair and reasonable in respect of the design of the new factory at Glina. " 112Arrangements were made for Mr Sirakas to attend a second interview on 21 April 2010. 113Mr Sirakas informed Ms Turner that on or about 29 October 2010 he was given a copy of a " resolution " regarding the initiation of criminal proceedings dated 7 May 2010. The English translation of that document refers to the initiation of criminal proceedings against Mr Sirakas in relation to the conclusion of a services contract with SC Ister International Company SRL in respect of the Bohrwerk machine stating that the machine had been identified and purchased, but had received no improvements, yet APRO paid Ister a commission and fee for the so-called provision of services. It was a resolution dated 7 May 2010 confirming the initiation of criminal proceedings " towards SIRAKAS GEORGIOS who is charged of committing the crime of using in bad faith the goods or the credit of the company in purposes contrary to its interests or in their own interests or for the benefit of another person, a deed provided by the art. 272 paragraph 1, point 2 of the Law 31/1990 ". 114There was uncontradicted evidence of a Professor of Law specialising in criminal business law in Romania that according to Romanian criminal procedure, the criminal process includes two phases: the prosecution phase, carried out by the criminal investigation and prosecution bodies, and the trial phase, carried out by the courts. The uncontradicted expert evidence is that " resolution " documents are issued as part of the mandatory prosecution phase if it is considered that there is sufficient evidence that a crime has been committed to initiate the prosecution phase. Once the prosecution phase has been reached, then the prosecutor considers whether an indictment should be issued which would have the effect of initiating a criminal trial. Whilst the English translation of the " resolution " document referred to the initiation of criminal proceedings, the expert evidence is that a more appropriate translation would be that a criminal prosecution, rather than criminal proceedings, had been commenced. Commencement of the criminal prosecution, that is, the commencement of the prosecution phase of the criminal process relates to the prosecutor determining whether there is sufficient evidence of the commission of a crime to warrant the filing of an indictment which initiates the criminal action. 115It does not appear that the police department's investigations into the Glina land transaction has resulted in those investigations moving to the formal prosecution phase. Nor does it appear that the investigation into the sale of the Excitation Generator System has led to the investigation moving to a formal prosecution phase. The plaintiffs lodged an official complaint to the police on 8 May 2009 in relation to the sale of the Excitation Generator System. On 16 August 2011, more than two years later, Mr Sirakas was informed that he was a suspect in relation to that matter and was asked to attend the police station on 29 August 2011. There is no evidence as to whether he attended that interview, or of anything arising from it. 116The pendency of criminal investigations in Romania does not warrant a stay of the civil proceedings in this court. It was common ground that Mr Sirakas had the same " right to silence " in Romania as he would in New South Wales. In this State Mr Sirakas would be entitled to claim privilege against self-incrimination in respect of charges that might be brought against him in Romania. However, as Wootten J said in McMahon v Gould , a plaintiff in a civil action is not debarred from proceeding with a civil claim merely because to do so would or might result in the defendant, if he wishes to defend the action, having to disclose what his defence is likely to be in the criminal proceedings. 117In this case Mr Sirakas has served a defence to the statement of claim as originally filed. There is no real prospect that publicity of the civil proceedings might influence any court hearing the criminal proceedings in Romania. There is no realistic possibility of miscarriage of justice that the disclosing of a defence in this civil proceeding might enable fabrication of evidence by prosecution witnesses in Romania, or interference with defence witnesses. There has been no hearing set for any criminal proceedings and no such proceedings have been instituted beyond the institution of a formal prosecution phase in relation to possible charges in relation to the Bohrwerk machine. There is no indication as to how long the criminal investigations in Romania might take. It has been over two years since complaints were made to the police in Romania. 118As matters presently stand, the interests of justice do not require that the plaintiffs' civil suit be stayed because of possible criminal proceedings in Romania.

Production of PWC documents 119By his notice of motion of 7 April 2011 Mr Sirakas sought an order that APRO produce to the court " all correspondence between the second plaintiff with Price Waterhouse Coopers Romania ('PWC') in respect of any employment agreement, individual labour contract, secondment agreement, application for residency or taxation advice relating to the engagement of the defendant with the second plaintiff and or the third plaintiff in the period 30 June 2003 to 30 April 2009. " Mr Sirakas also sought an order that APRO, through its proper officer, serve an affidavit concerning the inquiries made on behalf of APRO to locate any such documents. He sought a stay of the proceedings pending production of any such documents. 120Mr Sirakas tendered a letter of advice from PriceWaterhouse Coopers in Romania to him dated 28 November 2003. It addressed issues concerning compliance with Romanian taxation legislation relating to his assignment in Romania. It addressed taxation implications amongst other issues of his being employed under a local employment contract, or under a foreign employment contract. It discussed issues in relation to secondment and addressed issues arising from the Romanian Labour Code and a " National Employment Collective Agreement ". It addressed issues that would arise if Mr Sirakas' salary continued to be paid by the foreign employer on behalf of the Romanian entity with those costs being recharged. 121Evidence was given by a Mr Badea, a taxation and immigration consultant in Romania who was employed by PriceWaterhouse Coopers between 1 July 2002 and 15 August 2006. He referred to there being email correspondence in relation to the employment structure to be adopted for Mr Sirakas. 122There was no evidence to suggest that any employment contracts were entered into other than those that have been produced. It has not been shown that any of the correspondence with PriceWaterhouse Coopers in relation to Mr Sirakas' employment arrangements would have any relevance to the plaintiffs' claims or his defence of them. I would not order discovery of such documents. There is no reason to make the order for production.

Conclusion and orders 123The remaining claim in the defendant's notice of motion that no reasonable cause of action had been disclosed by the first plaintiff against Mr Sirakas was not pressed. 124Nor was the application to discharge the freezing orders made on 8 December 2009 pressed. 125It follows that the defendant's notice of motion filed on 7 April 2011 should be dismissed. 126In written submissions the plaintiffs' counsel requested that no orders be made when judgment was handed down so that the plaintiffs would have the opportunity, should it be necessary, to determine whether they wish to further amend the statement of claim to address conclusions reached in the judgment. 127I see no reason not to make orders to dispose of the notice of motion. If the plaintiffs seek leave further to amend the statement of claim, and if the defendant does not consent to any proposed amendments, that question will have to be dealt with on an application for leave further to amend. 128For these reasons I order that the defendant's notice of motion filed on 7 April 2011 be dismissed. Prima facie the defendant should be ordered to pay the plaintiffs' costs of the notice of motion. I will hear the parties on costs. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 15 February 2012