Ferris v Sanguine Investment Managers LLC

Conclusion

1. For the following reasons, I am satisfied both that the leave sought should be granted and the orders sought should be made.
2. Further, I am also satisfied that Mr Ferris should be given leave to amend his summons to pursue the recognition of a further costs judgment which the Qatari Court has recently given in his favour in relation to the contempt proceedings.

Mr Ferris' unopposed case

1. Mr Ferris relied on unchallenged affidavits he has sworn, as well as those sworn by process servers and Ms Clarke, his solicitor, as to the Qatari proceedings; their settlement and the orders made by the judgments which he now seeks to have recognised; as well as service on Mr Leach in Australia and SIM in Qatar, of the summons and his supporting affidavit, in order to meet the requirements of the applicable principles.
2. That evidence established that both SIM and Mr Leach have been served with the summons and Mr Ferris' supporting affidavit. But neither filed a notice of appearance, or appeared at the hearing.
3. Mr Ferris' case was that the evidence he advanced provided a basis for the leave he requires and also satisfied the well settled common law principles for the recognition of foreign judgments which were summarised by Rothman J in Bao v Qu; Tian (No 2) (2020) 102 NSWLR 435; [2020] NSWSC 588 at [26] and [29]. They have subsequently been repeatedly applied. Most recently in Zhengzhou Lvdu Real Estate Group Co Ltd v Shu [2024] NSWSC 58 and Wilson v Wilson [2024] NSWSC 506.

What the evidence established

1. I am satisfied that it was in June 2022 that Mr Ferris entered into a deed of settlement with SIM and Mr Leach, which compromised aspects of the proceedings which he had brought in Qatar, originally against them as well as other defendants.
2. What was initially there in issue included the jurisdiction of the First Instance Circuit, Civil and Commercial Court in respect of the claims Mr Ferris pursued. The jurisdictional issue was abandoned by SIM and Mr Leach when they filed their amended defence in February 2022. Under the June settlement, Mr Ferris was to be paid some $US500,000 in agreed instalments by November 2022, in full and final settlement of their dispute. SIM and Mr Leach were jointly and severally liable for what had been so agreed.
3. The settlement agreement contained a term giving the Qatar Court exclusive jurisdiction in relation to that agreement and any legal action or proceedings arising out of it. The settlement bound all three parties and provided for the stay of the proceedings on terms which were agreed, except for the purpose of enforcing the settlement.
4. None of the agreed payments were made by SIM or Mr Leach, with the result the orders made in Mr Ferris' favour by the Qatari Court when he successfully enforced the settlement. The judgments he obtained included orders in relation to his assessed costs, which had not been opposed by Mr Leach or SIM.
5. While they did not agree with the orders which he sought, they did not appear in the Qatari Court to oppose the orders which he obtained. It was in April 2023 that the Qatari Court made further orders requiring SIM and Mr Leach to disclose their worldwide assets. Mr Leach later swore an affidavit which did not deal with SIM's assets. Mr Ferris later sought and obtained an assessment of the costs involved in his pursuit of the asset disclosure order.
6. Mr Ferris also successfully pursued contempt proceedings against SIM and Mr Leach, in which they also did not appear. There he established that Mr Leach had not satisfied the Court's binding orders; the affidavit which he swore had omitted some of his assets; and he there provided false information. The result was the imposition of a penalty. But he does not seek to have that judgment recognised.
7. There has, however, recently been another judgment given in which further costs orders were made in Mr Ferris' favour in respect of the contempt proceedings. At the hearing Mr Ferris sought leave to amend his summons to also seek recognition of that judgment.
8. Mr Ferris contended that the evidence established that all of the applicable principles have been satisfied, both SIM and Mr Leach having been served with the summons by which these proceedings were commence and having not entered an appearance or sought to meet the evidence he relied on, to resist the orders sought. In the result, the orders sought not being opposed, they should be made and he should also be given the further leave which he sought in order to have the sixth judgment he wishes to enforce recognised here.

Service and leave

1. I am satisfied that the summons and supporting affidavit were served on both Mr Leach in Australia and on SIM in Qatar and that the leave he requires in respect of SIM must be granted.

Mr Leach

1. The Rules provide for personal service of originating process, except as otherwise provided: r 10.20(2). Personal service involves leaving the document with the person being served or putting it down in the person's presence and telling them the nature of the document: r 10.21. The Rules also recognise that personal service will not always be possible.
2. Personal service may thus also be effected on a person who "keeps house". That is where a person remains in premises to which a person attempting service cannot lawfully or practicably obtain access. Service can then be effected by placing the document in the mailbox at that address and then within 24 hours posting a notice to those premises, addressed to the person keeping house, informing them that the document has been so placed: r 10.26.
3. Service of the summons and supporting affidavit was sought to be effected at a property owned by Mr Leach's wife at Wollstonecraft NSW. That being the address he used in documents he had filed in the Qatari proceedings, including in his February 2022 defence and the April 2023 affidavit he had sworn.
4. It was also the address recorded in the settlement agreement as being Mr Leach's address. It was also the address recorded for him, with the Australian Electoral Commission, as at July 2024. It is also the address, and disclosed on an ASIC search, as that which Mr Leach uses in respect of his current officeholdings and shareholdings, in accordance with requirements of the Corporations Act 2001 (Cth).
5. This property is at a residential unit complex to which only residents and their guests can gain access. Process servers have attempted to effect service there, but they and Mr Ferris have been unable to gain entry. On 2 June 2024, copies of correspondence from Mr Ferris' solicitors and the documents sought to be served were thus left in the mailbox of that residence and advice that this had been done was sent to Mr Ferris by express post to that address the following day.
6. Mr Ferris contends that the Court would infer that Mr Leach had been attempting to evade service, that being consistent with his approach to the Qatar contempt proceedings, referred to in the contempt judgment. It is not necessary to come to a concluded view about this.
7. I am satisfied that the evidence does establish that service has been effected on Mr Leach in accordance with r 20.26, he being a person who keeps house at the address at which he has been served, in accordance with the requirements of that Rule.

SIM

1. In SIM's case, leave is required to proceed against it, the summons having been served outside Australia and it not having entered an appearance here: r 11.8AA of the Uniform Civil Procedure Rules 2005 (NSW)
2. In all of the circumstances I have explained, I am satisfied that Mr Ferris should have leave to proceed against SIM, so that enforcement of the final judgments which the Qatar Court has made can be pursued here.
3. The relevant considerations on an application for leave to proceed against a foreign registered company such as SIM, were again discussed in AGC Capital Securities Pty Ltd v JaiJaifu Modern Agriculture (HK) Limited [2019] NSWSC 62 at [3]. They remain those derived from Agar v Hyde (2000) 201 CLR 552; [2000] HCA 41. They are that: 1. the defendant has been properly served. 2. the claim in the originating process falls within Sch 6 to the UCPR. 3. it be demonstrated that there is a real issue to be determined. 4. his Court is not a clearly inappropriate forum.
4. Unless the Court otherwise orders, a defendant who has been served outside of Australia must file an appearance within 42 days from the date of service: r 11.8. I am satisfied that this time has expired, SIM having been served in accordance with the law of Qatar on 10 June 2024: r 11.8AC.
5. The Qatar Financial Centre Civil and Commercial Court Regulations and Procedural Rules required SIM, a limited liability company, to have a registered office there and to carry on its principal business activity at or from that office, unless the QFC authority permitted it to carry out that business elsewhere. Documents could be served on it at that office, by leaving them at, or sending them by hand, fax or courier to that registered office: art 18.
6. The evidence thus establishes the summons and Mr Ferris' supporting affidavit were served on SIM on 10 June 2024 at its registered office at level 15, Office no 1526, Commercial Bank Plaza, West Bay, Doha, Qatar, when they were hand delivered there. It has thus been properly served.
7. Schedule 6 of the Rules deals with service outside Australia, which is permitted without leave in the circumstances specified at (m), "when it is sought to recognise or enforce any judgment". This is such a case.
8. The evidence suggests that there is a real issue about the enforcement of the Qatari judgments in Australia. The Qatari Court having exercised jurisdiction over the parties and required Mr Leach and SIM to reveal the location of their assets worldwide as it did and also having dealt with them as it did for contempt, for failing to comply with its orders, that issue must be determined in Mr Ferris' favour.
9. It also follows that the evidence does not suggest that this Court is a clearly inappropriate forum for the enforcement of the judgments and orders of the Qatari Court and that Mr Ferris has a real issue to pursue in respect of their enforcement here.

Should the judgments be registered?

1. The applicable common law principles for recognition of a foreign judgment were discussed again in Bao v Qu at [26]: "At common law, a foreign judgment is prima facie capable of recognition and enforcement if the following requirements have been met: (1) the foreign court must have exercised jurisdiction of the requisite type over the defendant (also known as jurisdiction 'in the international sense'); (2) the judgment must be final and conclusive; (3) there must be identity of parties between the judgment debtors and the defendants in any enforcement action; and (4) the judgment must be for a fixed, liquidated sum."
2. Further, at [29]: "The onus rests on the party seeking to enforce the foreign judgment to establish these four requirements: Carl Zeiss Stiftung v Rayner & Keele Ltd [1967] 1 AC 853, Schnabel at [74]-[76]. Once they are established, however, the judgment is prima facie enforceable as a valid obligation: Stern v National Australia Bank; National Australia Bank Ltd v Pollack [1999] FCA 1421 at [133] (Tamberlin J); Suzhou Haishun Investment Management Co. Ltd v Yue'e Zhao & Ors [2019] VSC 110 at [92]."
3. I am satisfied that the evidence also establishes that the Qatari Court exercised jurisdiction 'in the international sense' over Mr Ferris, Mr Leach and SIM in the proceedings before it; that there is identity of parties between the Qatar judgment debtors and the defendants in these proceedings; and that each of the judgments now sought to be enforced here was for a fixed, liquidated sum.
4. The term 'in the international sense' was also explained in in Bao v Qu, at [27]. The requirement being satisfied where the defendant is personally served with originating process within the jurisdiction of the foreign court and, if served outside the jurisdiction of the foreign court, having nonetheless appeared to argue the merits of the case, where they have submitted to the jurisdiction of that court.
5. On the evidence, while initially the Qatari Court's jurisdiction was challenged by Mr Leach and SIM, that was abandoned by their amended defence.; The parties later entering into the settlement agreement by which both Mr Leach and SIM irrevocably submitted to its exclusive jurisdiction in respect of legal actions arising out of that agreement and later consenting to the orders pursuant to which their agreement became enforceable in the Qatari proceedings.
6. SIM and Mr Leach later communicated their consent to the costs assessment being undertaken and also filed the affidavit which responded to the order to disclose their worldwide assets. That was even though they had not responded to the applications which resulted in the registrable judgments by which personal liability to pay Mr Ferris was imposed on them.
7. The evidence also establishes that the judgments now in question have not been challenged, nor appealed in Qatar. Even if any right of appeal remained, that would not affect the finality of those judgments, which remain final and conclusive until set aside on appeal: Bao v Qu at [28].
8. That accords with the Qatar Financial Centre Civil and Commercial Court Regulations and Procedural Rules: at arts 32.1, 32.4, 34.1. and 35.1. The latter providing for permission to appeal only where a Court of three judges finds there are "substantial grounds for considering that a judgment is erroneous and there is a significant risk that it will result in serious injustice".
9. On the evidence no application for such a finding has been made by either Mr Leach or SIM, in respect of any of the five judgments for which recognition orders are here sought.
10. In the result, it must be concluded that all five of the Qatari judgments must be recognised.

Costs and further hearing

1. In all those circumstances I am well satisfied that the orders sought must be made, noting that to this point, Mr Ferris has not sought any costs orders in these proceedings, which must thus be reserved.
2. The matter will thus be listed for further directions on 8 October 2024 in relation to the hearing of the application for recognition of the further judgment of the Qatar International Court First Instance Circuit of 19 August 2024.

Orders

1. For these reasons I now order that: 1. Pursuant to rule 11.8AA of the Uniform Civil Procedure Rules 2005 (NSW), the plaintiff have leave to proceed against the First Defendant; 2. Judgment of the Qatar International Court First Instance Circuit dated 27 September 2022 in proceedings CTFIC0023/2021 for the Plaintiff in the sum of USD 300,000 and interest at the rate of 2.5% from 31 August 2022 until payment is recognised by the Supreme Court of New South Wales; 3. Judgment of the Qatar International Court First Instance Circuit dated 14 November 2022 in proceedings CTFIC0023/2021 for the Plaintiff in the sum of USD 6,340 is recognised by the Supreme Court of New South Wales; 4. Judgment of the Qatar International Court First Instance Circuit dated 8 January 2023 in proceedings CTFIC0023/2021 for the Plaintiff in the sum of USD 200,000, interest at the rate of 2.5% on USD 100,000 from 31 October 2022 until payment and interest at the rate of 2.5% on USD 100,000 from 30 November 2022 until payment is recognised by the Supreme Court of New South Wales; 5. Judgment of the Qatar International Court First Instance Circuit dated 2 April 2023 in proceedings CTFIC0023/2021 for the Plaintiff in the sum of USD 6,741 is recognised by the Supreme Court of New South Wales; 6. Judgment of the Qatar International Court First Instance Circuit dated 3 July 2023 in proceedings CTFIC0023/2021 for the Plaintiff in the sum of USD 2,610 is recognised by the Supreme Court of New South Wales; 7. The plaintiff have leave to file an amended summons to seeking orders for recognition of an order of the Qatar International Court First Instance Circuit of 19 August 2024; and 8. The matter be listed before me for further directions at 9:30am on 8 October 2024.

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: 27 August 2024