Beijing Be Green Import & Export Co Ltd v Elders International Australia Pty Ltd

Consideration and Decision 49 In TCL Air Conditioner (Zhongshan) Co Ltd v The Judges of the Federal Court of Australia (2013) 251 CLR 533 (TCL), the High Court rejected a constitutional challenge to this Court's jurisdiction to enforce an arbitral award under Art 35 of the UNCITRAL Model Law which is Sch 2 to the IAA. Although the case concerned the Model Law and the enforcement of an award made in an international arbitration conducted in Australia, the reasoning of the High Court has significance for the interpretation of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted in 1958 by the United Nations Conference on International Arbitration at its twenty-fourth meeting (the Convention) which is set out in Sch 1 to the IAA. Part II of the IAA is intended to give effect to the Convention. 50 As I have held in a number of cases, the enforcement provisions set out in Pt II of the IAA should be interpreted by not only paying appropriate regard to s 2D and s 39 of the IAA itself but also by bearing in mind the objects and purposes of Arts 1 to VI of the Convention. In particular, I have repeatedly held that the only grounds upon which an award debtor can resist enforcement of a foreign arbitral award in Australia are those set out in ss 8(5), 8(7) and 8(7A) of the IAA (see, by way of example, Coeclerici Asia (Pte) Ltd v Gujarat NRE Coke Ltd [2013] FCA 882 at [30]). An adjournment of an enforcement proceeding may be granted if the conditions specified in s 8(8) and s 8(11) of the IAA are met. However, such an adjournment is subject to reconsideration under s 8(9) and s 8(10). 51 In TCL, at 545-549 [9]-[13], the Chief Justice and Gageler J said: 9 In common with the New York Convention, the Model Law nevertheless proceeds on a conception of the nature of an arbitral award, and a conception of the relationship of an arbitral award to an arbitration agreement, identical in substance to the conception that has for centuries underpinned the understanding of an arbitral award at common law as "a satisfaction pursuant to [the parties'] prior accord of the causes of action awarded upon" and as thereby "precluding recourse to the original rights the determination of which had been referred to arbitration" (Dobbs v National Bank of Australasia Ltd (1935) 53 CLR 643 at 653-654). That conception, in short, is that "the foundation of arbitration is the determination of the parties' rights by the agreed arbitrators pursuant to the authority given to them by the parties" (Associated Electric & Gas Insurance Services Ltd v European Reinsurance Co of Zurich [2003] 1 WLR 1041 at 1046 [9]). The English law of arbitration, which has combined statute law with common law since the seventeenth century, has at "every stage" of its development "approached the relationships between the parties and the arbitrator, and between the parties and each other, unequivocally in terms of private law" (Mustill and Boyd, The Law and Practice of Commercial Arbitration in England, 2nd ed (1989), p 4. See also Blackaby et al, Redfern and Hunter on International Arbitration, 5th ed (2009), para [1.02]). The same approach has been evident in the historical development of the statute law and the common law governing arbitration in Australia (Law Reform Commission of New South Wales, Report on Commercial Arbitration, Report No 27 (1976), paras [1.6], [9.1.1]). That is so notwithstanding the truth of the observation that performance of the arbitral function is not "purely a private matter of contract, in which the parties have given up their rights to engage judicial power" and is not "wholly divorced from the exercise of public authority" (Westport Insurance Corporation v Gordian Runoff Ltd (2011) 244 CLR 239 at 261-262 [20]). 10 The conception is captured, and its international commercial significance is explained, in the following observation (Comandate Marine Corporation v Pan Australia Shipping Pty Ltd (2006) 157 FCR 45 at 94-95 [192]-[193]): "The New York Convention and the [UNCITRAL] Model Law deal with one of the most important aspects of international commerce - the resolution of disputes between commercial parties in an international or multinational context, where those parties, in the formation of their contract or legal relationship, have, by their own bargain, chosen arbitration as their agreed method of dispute resolution. The chosen arbitral method or forum may or may not be the optimally preferred method or forum for each party; but it is the contractually bargained method or forum, often between parties who come from very different legal systems. An ordered efficient dispute resolution mechanism leading to an enforceable award or judgment by the adjudicator, is an essential underpinning of commerce … The recognition of the importance of international commercial arbitration to the smooth working of international commerce and of the importance of enforcement of the bilateral bargain of commercial parties in their agreement to submit their disputes to arbitration was reflected in both the New York Convention and the [UNCITRAL] Model Law." 11 The analytical commentary published by the UNCITRAL Secretariat to accompany the 1985 draft of the UNCITRAL Model Law (the UNCITRAL analytical commentary) spelt out that the UNCITRAL Model Law was "designed for consensual arbitration", which the UNCITRAL analytical commentary explained to mean "arbitration based on voluntary agreement of the parties" (UNCITRAL analytical commentary, Art 1 [15]). That design is reflected in the definition in the Model Law of an arbitration agreement as "an agreement by the parties to submit to arbitration all or certain disputes … between them in respect of a defined legal relationship" (Article 7 of the Model Law) and in the freedom that the Model Law gives to the parties both to determine the composition of the arbitral tribunal (Articles 10(1) and 11 of the Model Law) and to determine the procedure to be followed by the arbitral tribunal (Article 19(1) of the Model Law). The design is not inconsistent with default provisions within the Model Law which fill gaps in the agreement between the parties (See, eg, Arts 10(2), 11(3), 13(2), 17, 17B, 19(2), 20(1), 21, 22(1), 23, 24(1), 25, 26, 28(2) and 29 of the Model Law.), and which provide for court assistance to facilitate the process of arbitration (Articles 17J and 27 of the Model Law. See also ss 23 and 23A of the IAA). Nor is the design inconsistent with provisions of the Model Law incapable of derogation by the agreement of the parties, directed primarily to ensuring equality and fairness in the arbitral process (Article 18 of the Model Law) and to the form and correction of an arbitral award (Articles 31 and 33(2) of the Model Law). 12 The design is followed through in Art 36 of the Model Law in providing, in common with Art V of the New York Convention, for recognition or enforcement of an arbitral award to be refused at the request of a party against whom the arbitral award is invoked, if and to the extent that the party can furnish proof to the competent court of one or more specified grounds of refusal. Those grounds include: that the arbitration agreement is not valid under its governing law (Article 36(1)(a)(i) of the Model Law and Art V.1(a) of the New York Convention); that the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration or contains decisions on matters beyond the scope of the submission to arbitration (Article 36(1)(a)(iii) of the Model Law and Art V.1(c) of the New York Convention); and that the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties (Article 36(1)(a)(iv) of the Model Law and Art V.1(d) of the New York Convention). Whether one or more of those grounds is established is an objective question to be determined by the competent court on the evidence and submissions before it, unaffected by the competence of an arbitral tribunal to rule on its own jurisdiction under Art 16 of the Model Law (Dallah Real Estate & Tourism Holding Co v Pakistan [2011] 1 AC 763 at 808-813 [20]-[30]). Arbitration in this way remains "the manifestation of parties' choice to submit present or future issues between them to arbitration" in that, without "specific authority" to do so, arbitrators "cannot by their own decision … create or extend the authority conferred upon them" (Dallah Real Estate & Tourism Holding Co v Pakistan [2011] 1 AC 763 at 810 [24]). 13 The requirement of Art 28 of the Model Law, that the arbitral tribunal "decide the dispute in accordance with such rules of law as are chosen by the parties as applicable to the substance of the dispute", is a further manifestation of the same design. Article 28 was described in the UNCITRAL analytical commentary as a "recognition or guarantee of the parties' autonomy" (UNCITRAL analytical commentary, Art 28[3]) and as allowing the parties to an arbitration agreement "to designate as applicable to their case rules of more than one legal system, including rules of law which have been elaborated on the international level" (UNCITRAL analytical commentary, Art 28[4]). Its dual significance was elaborated in an explanatory note by the UNCITRAL Secretariat on the UNCITRAL Model Law as amended in 2006 (the UNCITRAL Explanatory Note) as follows (UNCITRAL Explanatory Note, para [39]): "It grants the parties the freedom to choose the applicable substantive law, which is important where the national law does not clearly or fully recognize that right. In addition, by referring to the choice of 'rules of law' instead of 'law', the Model Law broadens the range of options available to the parties as regards the designation of the law applicable to the substance of the dispute. For example, parties may agree on rules of law that have been elaborated by an international forum but have not yet been incorporated into any national legal system. Parties could also choose directly an instrument such as the United Nations Convention on Contracts for the International Sale of Goods as the body of substantive law governing the arbitration, without having to refer to the national law of any State party to that Convention." 52 These passages emphasise the fundamental reason why the Courts have long enforced arbitral awards: An arbitral award represents the end product of the parties' consensual arrangements for resolution of their disputes according to the terms of those arrangements freely and voluntarily entered into. 53 Hayne, Crennan, Kiefel and Bell JJ expressed similar views to those of the Chief Justice and Gageler J. At 557-560 [41]-[50], their Honours said: 41 The International Arbitration Act 1974 (Cth) (the IA Act), and the international conventions and law to which it gives effect (International Arbitration Act 1974 (Cth), s 2D(d), (e), (f)), facilitate the use of arbitration agreements and the curial recognition and enforcement of arbitral awards made in relation to international trade and commerce (International Arbitration Act 1974 (Cth), s 2D(b), (c)). 42 The plaintiff (TCL), a company registered, and having its principal place of business, in the People's Republic of China, entered into a written distribution agreement with the second defendant (Castel), a company registered, and having its principal place of business, in Australia (the agreement). The agreement provided for the submission of disputes to arbitration in Australia. Following a commercial arbitration two awards were made requiring TCL to pay to Castel $3,369,351 and costs of $732,500. In default of payment, Castel applied under the IA Act to the Federal Court of Australia to enforce the awards. In separate proceedings, TCL applied to set aside those awards. 43 Of particular relevance is Pt III (ss 15-30A) of the IA Act. Headed "International Commercial Arbitration", it concerns arbitration agreements and the recognition and enforcement of arbitral awards governed by the UNCITRAL Model Law on International Commercial Arbitration (the Model Law) (Adopted by the United Nations Commission on International Trade Law (UNCITRAL) on 21 June 1985 and amended by UNCITRAL on 7 July 2006). Section 16(1) of the IA Act gives "the force of law in Australia" to the Model Law, the English text of which is contained in Sch 2 to the IA Act. 44 In the proceedings in this Court's original jurisdiction, TCL submitted that s 16(1) of the IA Act is beyond power because it infringes Ch III of the Constitution. What follow are our reasons for rejecting TCL's submissions and refusing to grant the relief sought by TCL. Arbitration 45 In The Rule of Law ((2010), p 86), Lord Bingham of Cornhill described arbitration as involving: "the appointment of an independent arbitrator, often chosen by the parties, to rule on their dispute according to the terms of reference they give him. This can only be done by agreement, before or after the dispute arises, but where it is done the arbitrator has authority to make an award which is binding on the parties and enforceable by the process of the courts." That description of private arbitration (The term "private arbitration" refers to arbitration undertaken in fulfilment of an agreement to submit a dispute to arbitration. Private arbitration is distinguishable from arbitration concerned with the enforcement of public rights derived from statute, such as arbitration to resolve industrial law disputes), and of the relationship between private arbitration and the courts, is as apt for Australia (Dobbs v National Bank of Australasia Ltd (1935) 53 CLR 643 at 652-654; Minister for Works (WA) v Civil & Civic Pty Ltd (1967) 116 CLR 273 at 284; Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (CFMEU) (2001) 203 CLR 645 at 658 [31]; Westport Insurance Corporation v Gordian Runoff Ltd (2011) 244 CLR 239 at 261-262 [19]-[20]) as it is for the United Kingdom (Fiona Trust & Holding Corporation v Privalov [2007] 4 All ER 951 at 956 [5]) and the United States of America (Stolt-Nielsen SA v AnimalFeeds International Corporation (2010) 176 Law Ed (2d) 605 at 624). Arbitration has a long history as an alternative method, distinct from litigation, of resolving civil disputes (Mustill and Boyd, The Law and Practice of Commercial Arbitration in England, 2nd ed (1989), Ch 29. See also Stephen, "Historical Origins of Arbitration", The Arbitrator (August, 1991) 45; Jones, Commercial Arbitration in Australia (2011), pp 4-11 [1.150]-[1.200]). The features of private arbitration identified by Lord Bingham underpin the widely shared modern policy of recognising and encouraging private arbitration as a valuable method of "settling disputes arising in international commercial relations" (Stated in the preamble to the Resolution of the General Assembly of the United Nations of 11 December 1985, approving the Model Law adopted by UNCITRAL), a policy reflected in the objects of the IA Act (International Arbitration Act 1974 (Cth), s 2D(a), (b), (c)). Parties from different legal systems can agree to resolve an international commercial dispute by arbitration and choose both the law (or laws) to be applied and the processes to be followed. 46 From the 1920s onwards, various international conventions and laws dealing with international commercial arbitration agreements (For present purposes the most important are: the Geneva Protocol on Arbitration Clauses in Commercial Matters (1923) (the Geneva Protocol); the Geneva Convention on the Execution of Foreign Arbitral Awards (1927) (the Geneva Convention); the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958) (commonly, "the New York Convention"); and the Model Law) have been directed to encouraging a level of uniformity in national statutes covering such matters as the international validity of arbitration agreements, the limits of curial assistance or intervention in the arbitral process and the enforcement of awards (See generally Blackaby et al, Redfern and Hunter on International Arbitration, 5th ed (2009), Ch 1; Born, International Commercial Arbitration (2009), vol 2, Ch 25; Binder, International Commercial Arbitration and Conciliation in UNCITRAL Model Law Jurisdictions, 3rd ed (2009); Holtzmann and Neuhaus, A Guide to the UNCITRAL Model Law on International Commercial Arbitration: Legislative History and Commentary (1989), pp 1-17). The IA Act gives effect to three of those international instruments, as described below. 47 Part II (ss 3-14) of the IA Act, headed "Enforcement of foreign awards", implements (International Arbitration Act 1974 (Cth), s 2D(d)) the New York Convention (Adopted in 1958 by the United Nations Conference on International Commercial Arbitration at its twenty-fourth meeting (s 2D(d)). The English text is contained in Sch 1 to the IA Act. Article VII(2) of the New York Convention provides that that Convention replaces the Geneva Protocol and the Geneva Convention as between States which are parties to the New York Convention). Section 7 (Implementing Art II of the New York Convention) of the IA Act provides for the recognition of arbitration agreements by mandating a stay of court proceedings brought in breach of an arbitration agreement governed by the New York Convention (An "arbitration agreement" for the purposes of Pt II is defined in s 3(1)). Section 8 provides for the enforcement of "foreign awards" in Australia "as if the award were a judgment or order" of the Federal Court or a State or Territory court (International Arbitration Act 1974 (Cth), s 8(3), (2)). In implementing Art V of the New York Convention (Which sets out the limited grounds upon which a court may refuse to enforce an award. This provision followed in some respects and expanded the limited grounds for the same purpose set out in the Geneva Convention, Arts 1, 2), s 8 contains limited grounds upon which a court may refuse to enforce a foreign award (International Arbitration Act 1974 (Cth), s 8(5), (7)). 48 Part III, as noted, concerns arbitral awards governed by the Model Law. Provisions in Art 36(1) limiting the grounds upon which a court may refuse to enforce a foreign award, described in more detail below, are modelled on Art V of the New York Convention. An account of the development of the Model Law, and before it the New York Convention, can be found in the reasons of French CJ and Gageler J (See [7]-[11] above). 49 Part IV (ss 31-38) concerns arbitration agreements and the recognition and enforcement of awards governed by the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (1965) (Signed by Australia on 24 March 1975 (ss 2D(f), 31(1)). The English text is contained in Sch 3 to the IA Act). 50 Part V (ss 39, 40) is headed "General matters". Section 39 applies in respect of all provisions of the IA Act governing the curial recognition and enforcement of awards. Relevantly, s 39 provides that courts exercising jurisdiction under the IA Act, including courts considering exercising powers under the Model Law (International Arbitration Act 1974 (Cth), s 39(1)(a)(iii), (iv)), which may include the Federal Court or a State or Territory court, must have regard to the fact that "arbitration is an efficient, impartial, enforceable and timely method by which to resolve commercial disputes" and that "awards are intended to provide certainty and finality" (International Arbitration Act 1974 (Cth), s 39(2)(b)(i), (ii)). 54 At 568 [81]-[82], their Honours continued: 81 It is the consensual foundation of arbitration which underpins the general rule, settled since the middle of the nineteenth century, that an award is final and conclusive and cannot be challenged either at law or in equity on the ground that the arbitrator has committed an error of fact or of law (Mustill and Boyd, The Law and Practice of Commercial Arbitration in England, 2nd ed (1989), p 439). 82 Since at least the late seventeenth century (and Statute 9 Will III c 15 for "determining Differences by Arbitration") (Commonly, "the first Arbitration Act"), the English law of arbitration provided statutory means for the direct enforcement of arbitral awards. The courts could enforce an arbitral award unless arbitrators "misbehaved themselves" or the award or arbitration "was procured by corruption or other undue means" (9 Will III c 15, s 1). The making of a legal error was not identified as a form of misbehaviour. Furthermore, the sole statutory ground upon which an arbitration (and inferentially an award) could be "set aside" was that the arbitration had been "procured by corruption or undue means" (9 Will III c 15, s 2). The "mischief" (Heydon's Case (1584) 3 Co Rep 7a at 7b [76 ER 637 at 638]) to which the statute was directed was that procedures available for enlisting the court's aid in enforcing arbitration agreements were cumbersome and they did not always provide a complete remedy (Mustill and Boyd, The Law and Practice of Commercial Arbitration in England, 2nd ed (1989), pp 432-435). There was no statutory right to invoke curial process in respect of legal error. But for the statutory exceptions mentioned, an award could be enforced as final and conclusive, regardless of any legal infirmity in the reasoning which underpinned it. 55 At 568-572 [88]-[99], their Honours explained the exception to enforcement developed in England: Error apparent on the face of the award. I need not refer to those paragraphs for present purposes. 56 In Uganda No 2, at 443 [12]-[13], I said: 12 The 1958 New York Convention is intended to facilitate the recognition and enforcement of foreign arbitral awards in Convention countries. The Act is intended to facilitate the recognition and enforcement of such awards in Australia. Unless the foreign arbitral award is reflected in a judgment or order of the Australian court in which recognition and enforcement is claimed, the party seeking to enforce that award will not be able to avail itself of the execution and recovery mechanisms available in that court. 13 Courts in this country and elsewhere have accepted that the appropriate way of recognising and enforcing a foreign monetary arbitral award is for the enforcing court to enter judgment or make an order for payment which reflects the terms of that award: see for example Xiadong Yang v S & L Consulting Pty Ltd [2008] NSWSC 1051; FG Hemisphere Associates LLC v Democratic Republic of Congo [2010] NSWSC 1394; Altain Khuder LLC v IMC Mining Inc (2011) 276 ALR 733; [2011] VSC 1; Norsk Hydro ASA v State Property Fund of Ukraine [2002] EWHC 2120 (Comm); and IPCO (Nigeria) Ltd v Nigerian National Petroleum Corporation (2005) 2 Lloyd's Rep 326; [2005] EWHC 726 (Comm). The words "as if" in s 8(3) of the Act, properly understood, support this approach. In my view, s 8(3) means that, subject to considering and determining such of the statutory grounds for refusing to enforce a foreign arbitral award as may be legitimately raised in any particular case, this court should treat the foreign arbitral award as if it were a judgment or order of this court. That is, once this court has decided to enforce the award, it should give full effect to that decision by directing the entry of an appropriate money judgment or by making an appropriate order for payment. 57 I adhere to those views. 58 In this Court, once a judgment has been ordered, in my opinion, it is susceptible to being stayed in an appropriate case. The source of the Court's power to stay a judgment or execution on a judgment is either or both r 41.03 FCR (stay of a judgment) or r 41.11 FCR (stay of execution of a judgment) or the inherent power of the Court to regulate its own processes. For example, a judgment debtor may seek a temporary stay pending the determination of an appeal from the first instance decision of the Court to order judgment in favour of an award creditor. That was the case in Gujarat NRE Coke Ltd v Coeclerici Asia (PTE) Ltd. That is not the case here. The present stay has not been sought pending the determination of an appeal from my decision to order judgment in favour of the applicant. Rather, it is sought pending the determination of an unrelated proceeding between the same parties. 59 Rules 41.03 and 41.11 give a broad discretion to the Court to stay a judgment or to stay execution of a judgment. The inherent power to order a stay is similarly broad. 60 However, the discretion to order a stay must be exercised judicially. 61 Some guidance as to the exercise of that discretion can be found in TC Trustees Ltd v JS Darwen (Successors) Ltd and State Bank of Victoria v Parry. 62 In TC Trustees Ltd v JS Darwen (Successors) Ltd, the English Court of Appeal removed a stay of execution on a judgment which the Master and the primary judge had granted. Judgment had been given for the principal amounts plus interest due under 45 loan notes. The full amount of principal had fallen due because the borrowers had failed to pay one instalment of interest as a result of a genuine mistake. 63 At 301-302, the Master of the Rolls, Lord Denning, said that, if the borrowers were entitled to any relief at all, it could only be by way of relief in equity. His Lordship doubted whether equity would grant relief in a case such as the case before him. His Lordship went on to hold that the particular ground relied upon by the borrowers in that case should have been raised in the action itself before judgment was granted. It could not be used as the basis for granting a stay after judgment. 64 His Lordship accepted that the Courts have an inherent jurisdiction to stay proceedings. He observed that a stay should only be granted on grounds relevant to the stay and not on grounds which could have been and should have been raised by way of defence in the action itself. 65 In State Bank of Victoria v Parry, two defendants obtained a partial stay of execution on a judgment entered against them on the ground that they should be allowed time to prosecute a proceeding instituted against a third party in which they claimed indemnification in respect of the judgment in respect of which they sought a stay. A partial stay was granted pursuant to a rule of Court which gave the Court power to stay execution on a judgment debt if satisfied that, by reason of special circumstances, it is inexpedient to enforce the judgment. 66 At 246, Malcolm CJ addressed the meaning of "special circumstances" in the relevant rule of Court. His Honour said: Where there is no defence to the plaintiffs claim, but there is a plausible counterclaim for an amount not less than the plaintiff's claim, summary judgment will be ordered with a stay of execution until the trial of the counterclaim or further order: Sheppards & Co v Wilkinson & Jarvis [1889] 6 TLR 13. In a proper case the court may order payment into court of part of the claim with a stay of execution pending the counterclaim: Slater v Cathcart [1891] 8 TLR 92. 67 These remarks of the Chief Justice were made in relation to a counterclaim which is bona fide arising out of the same subject matter as the action but which is not connected to the defence or which cannot be raised by way of defence. 68 His Honour continued (at 246): Where the counterclaim arises out of quite a separate and distinct transaction, or there is no connection between the claim and the counterclaim, the proper order is for judgment for the plaintiff with costs without a stay pending the trial of the counterclaim: see the authorities collected in the Annual Practice (1988) par 14/3-14/13, p 145. The degree of connection between the claim and counterclaim, the strength of the counterclaim and the ability of the plaintiff to satisfy any judgment on the counterclaim are some of the considerations which the court may take account of in the exercise of its discretion whether or not to order a stay. In general, therefore, a counterclaim which is in effect an unconnected cross-action will not provide a basis for a stay under O 14, r 3. Consistently with this position a stay of execution of a judgment will not ordinarily be granted simply because the defendants bring a cross-claim in another action against the plaintiff, in the absence of special circumstances rendering it inexpedient to enforce the judgment: Wagner v Laubscher Bros & Co [1970] 2 QB 313. In that case, which Sachs LJ described (at 317) as "a particularly plain case" the considerations which applied are of no relevance. A judgment obtained in the Federal Republic of Germany, after trial and appeals in that country, was registered under reciprocal enforcement legislation in England. The effect of registration was that it was to be treated as if it was a judgment of the English High Court. There was a cross-action pending in the English Court which had "slept" during the German proceedings. The cross-action raised the same issues as had been litigated in Germany. A stay was refused. 69 Malcolm CJ emphasised that, in general, a counterclaim which is, in effect, an unconnected cross-action will not provide a basis for a stay. This observation reflects the Courts' general approach that a judgment creditor should not ordinarily be denied the fruits of his or her judgment. There must be good reason to make an order which prevents recovery of those fruits, even temporarily. 70 In the present case, it must also be borne in mind that the judgment which I ordered on 24 November last was a judgment which gave effect to the Award. It was ordered in circumstances where this Court was required to recognise and enforce the Award unless the respondent could engage one or more of the grounds for refusing enforcement specified in s 8(5), s 8(7) and s 8(7A) of the IAA. The respondent did not make any application under s 8(8) - it could not have done so. The respondent conceded that it had no basis upon which to engage any of the grounds specified in s 8(5), s 8(7) and s 8(7A) and did not oppose the order for judgment. 71 These circumstances constitute powerful factors to be weighed in the balance against the grant of the stay claimed by the respondent. In a very real sense, staying the judgment which I have ordered would undermine the effective enforcement of the Award and disrespect the contractual underpinning of the arbitral processes which led to the making of the Award and which the High Court made clear in TCL should be respected and enforced. It should also be remembered that the respondent has not challenged the Award in China. 72 What factors, then, have been raised by the respondent in favour of the claimed stay and what weight should be given to them in the circumstances of the present case? 73 First, the respondent argued that its claim for damages for breach of C90 was both bona fide and meritorious. I have accepted that it is a genuine claim. The merits of the claim are contentious. The applicant is defending the claim in the CIETAC arbitration upon the basis which I have outlined at [10] and [32]-[34] above. The existence and bona fides of this claim constitute the starting premise for the respondent's stay argument. 74 Second, the respondent says that, when the applicant first raised its claims under C93 and C96, the respondent immediately countered with its claim for damages for breach of C90 and thereafter diligently pressed that claim in the C93 and C96 arbitrations until it was ultimately rejected by the Tribunal. But it did not commence its C90 arbitration until 16 January 2014. All it did was to assert its claim under C90 and seek to have it determined in the C93 and C96 arbitrations. 75 It was always open to the respondent to refer its claim for damages for breach of C90 to arbitration at all times from April 2013. Its decision not to do so until 16 January 2014 must be seen as a deliberate tactical decision adopted by it in an endeavour to defeat the applicant's claims in respect of C93 and C96 or at least to do so to the extent of its claim for damages for breach of C90. Had the respondent referred its dispute under C90 to arbitration in April 2013, it would have been open to it to apply to have the arbitration proceeding arising out of that referral consolidated with the arbitration proceedings arising out of the disputes under C93 and C96. Rather than adopt that course it continued to press its Counterclaim in the consolidated arbitration relating to C93 and C96. 76 I do not propose to give any weight to these circumstances relied upon by the respondent. In my view, it devised a plan designed to have its C90 claim taken into account in the C93 and C96 arbitrations but that plan was flawed. The respondent's current dissatisfaction with the lack of progress (as it sees matters) in the C90 arbitration is very largely the direct result of its failure to commence that arbitration in 2013 and of its firm adherence to its plan to endeavour to litigate that claim in the C93 and C96 arbitrations right up until the original Award was published on 7 July 2014. In any event, the respondent failed to establish that there has been any delay in the progress of the C90 arbitration. The evidence of Zhen Qinggui suggests that the C90 arbitration is proceeding normally in accordance with the rules and procedures of CIETAC. The respondent does not, of course, criticise CIETAC itself. 77 Third, the respondent relied upon the conduct of the applicant in not co-operating with its plan to have all three disputes arbitrated at the same time by the same tribunal and in objecting to the appointment of Mr Pow to the C90 arbitral tribunal. But the applicant is entitled to make decisions and to take steps in order to enforce its rights in such manner as it sees fit in its own best interests subject to complying with its obligations under the relevant arbitration clauses and the relevant general law. Here, the respondent chose to raise its C90 claim as a set-off in the C93 and C96 consolidated arbitration and to persist with that approach in the face of obvious difficulties. It did not institute its C90 arbitration promptly. The applicant ought not be criticised for not accepting the respondent's counterclaim in the consolidated arbitration as justiciable in that arbitration. It was entitled to pursue its claims and to resist the respondent's claim. In addition, the evidence before me established that CIETAC constituted the C90 tribunal with Mr Pow as a member on 15 October 2014. The applicant immediately objected to the appointment of Mr Pow. Instead of agreeing to a substitute nominee the respondent sought to continue with Mr Pow and to persuade CIETAC that his appointment was justified. This response on the part of the respondent has, to some extent, delayed the progress of the C90 arbitration. 78 Fourth, I do not consider the matters raised at [45] above to be relevant. The result of the C90 arbitration is not known at the moment and cannot be predicted with certainty. Whether the respondent could set aside a Statutory Demand under s 459G and s 459H of the Corporations Act 2001 (Cth) is not to the point. 79 Fifth, I do not propose to give any weight to the final group of submissions which I have summarised at [46] above. There is no evidence that the applicant is insolvent nor is there any evidence that it will be unable to meet any award made against it in the C90 arbitration. 80 There is no evidence that a foreign party will generally have difficulty enforcing an arbitral award in China. Proof of such a broad proposition would be extremely difficult if not impossible in any event. The evidence led by the respondent as to the problems allegedly encountered by Castel Electronics Pty Ltd in enforcing in China the Award made in Australia in its favour does not establish or even go any way towards establishing the proposition for which it was tendered. That evidence did not demonstrate insurmountable difficulties for Castel in seeking to enforce its award in China. Nor can any conclusions of general application be drawn from that evidence. In any event, it is important to remember that the C90 arbitration is being conducted in China under the auspices of CIETAC by a tribunal appointed by CIETAC. Any award made in that arbitration will be a CIETAC award. There is no proper basis for suggesting that such an award will not be enforced in China. 81 Finally, I give no weight to the respondent's offer to put up security as a condition upon which any stay should be granted. Were the grant of a stay otherwise justified, such a condition would be imposed. It is a given. But the offer of security should not be taken into account as a factor in favour of the grant of a stay.

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