First Plaintiff Second Plaintiff v First Defendant Second Defendant Third Defendant Fourth Defendant

First Plaintiff Second Plaintiff v First Defendant Second Defendant Third Defendant Fourth Defendant - [2012] VSC 1 - VSC 2012 case summary — Zoe

[19]

"Although stay orders and anti-suit injunctions are not governed by the same principles, it will later become apparent that, in some cases, the power to grant anti-suit injunctions is an aspect of the power which authorises a court to stay its own proceedings. And it will also become apparent that, in other cases, the power to grant anti-suit injunctions should not be exercised without the court concerned first considering whether its own proceedings should be stayed.

The test which, in this country, governs a stay of proceedings in favour of proceedings in another country is as stated in Voth v Manildra Flour Mills Pty Ltd. In that case, this Court declined to adopt the more appropriate forum test laid down by the House of Lords in Spiliada Maritime Corp v Cansulex Ltd and accepted, instead, the test propounded by Deane J in Oceanic Sun Line Special Shipping Company Inc v Fay, namely, that a stay is only to be granted if the Australian court is a clearly inappropriate forum.

It was pointed out in the joint majority judgment in Voth that it was common ground in the judgments of the majority in the earlier case of Oceanic Sun that 'the traditional power to stay proceedings ... on inappropriate forum grounds, is to be exercised in accordance with the general principle empowering a court to dismiss or stay proceedings which are oppressive, vexatious or an abuse of process and the rationale for the exercise of the power to stay is the avoidance of injustice ... in the particular case'.

It is clear from the rationale for the exercise of the power to stay proceedings and, also, from the words 'oppressive', 'vexatious' and 'abuse of process' in Voth, in Oceanic Sun and in the earlier cases considered in Oceanic Sun, including St Pierre v South American Stores (Gath & Chaves) Ltd, that the power to stay proceedings on grounds of forum non conveniens is an aspect of the inherent or implied power which, in the absence of some statutory provision to the same effect, every court must have to prevent its own processes being used to bring about injustice." [Footnotes omitted]

[21]

"The counterpart of a court's power to prevent its processes being abused is its power to protect the integrity of those processes once set in motion. And in some cases, it is that counterpart power of protection that authorises the grant of anti-suit injunctions. Thus, for example, if 'an estate is being administered ... or a petition in bankruptcy has been presented ... or winding up proceedings have been commenced ... an injunction [may be] granted to restrain a person from seeking, by foreign proceedings, to obtain the sole benefit of certain foreign assets'. Similarly, as Gummow J pointed out in National Mutual Holdings Pty Ltd v The Sentry Corporation, a court may grant an injunction to restrain a person from commencing or continuing foreign proceedings if they, the foreign proceedings, interfere with or have a tendency to interfere with proceedings pending in that court.

The inherent power to grant anti-suit injunctions is not confined to the examples just given. As with other aspects of that power, it is not to be restricted to defined and closed categories. Rather, it is to be exercised when the administration of justice so demands or, in the context of anti-suit injunctions, when necessary for the protection of the court's own proceedings or processes.

Quite apart from the inherent power of a court to protect its own processes, a court may, in the exercise of the power deriving from the Chancery Court, make orders in restraint of unconscionable conduct or the unconscientious exercise of legal rights. If the bringing of legal proceedings involves unconscionable conduct or the unconscientious exercise of a legal right, an injunction may be granted by a court in the exercise of its equitable jurisdiction in restraint of those proceedings no matter where they are brought.

In some cases, the equitable jurisdiction to restrain unconscionable conduct may be exercised in aid of legal rights. Thus, as the respondents correctly contend, if there is a contract not to sue, an injunction may be granted to restrain proceedings brought in breach of that contract, whether brought here or abroad. Similarly, an injunction may be granted in aid of a promise not to sue in a foreign jurisdiction constituted, for example, by an agreement to submit to the exclusive jurisdiction of the courts of the forum.

One well established category of case in which an injunction may be granted in the exercise of equitable jurisdiction is that involving proceedings in another court, including in a foreign court, which are, according to the principles of equity, vexatious or oppressive. Thus, it was said in Carron Iron Company v Maclaren that '[w]here [there is] ... pending a litigation here, in which complete relief may be had, [and] a party to the suit institutes proceedings abroad, the Court of Chancery in general considers that act as a vexatious harassing of the opposite party, and restrains the foreign proceedings.'

In Société Aerospatiale, the Privy Council emphasised that the various cases decided in the nineteenth century with respect to vexation and oppression, including Peruvian Guano Company v Bockwoldt, have continuing significance for the grant of anti-suit injunctions. Those cases establish that the mere co-existence of proceedings in different countries does not constitute vexation or oppression. In particular, Peruvian Guano establishes that 'double litigation [which] has no other element of oppression than this, that an action is going on simultaneously abroad, which will give other or additional remedies beyond those attainable in [the domestic forum]' does not amount to vexation or oppression.

More recently, in Bank of Tokyo Ltd v Karoon, Robert Goff LJ pointed out, correctly, in our view, although without specific reference to underlying equitable principle, that foreign proceedings are to be viewed as vexatious or oppressive only if there is nothing which can be gained by them over and above what may be gained in local proceedings. On the other hand, they are vexatious or oppressive if there is a complete correspondence between the proceedings or, in terms used in Carron Iron Company, if 'complete relief' is available in the local proceedings." [Footnotes omitted]

[49]

"Parallel proceedings in another country with respect to the same issue may be compared with multiple proceedings with respect to the same subject matter in different courts in Australia. In Union Steamship Co of New Zealand Ltd v The Caradale, Dixon J observed of that latter situation that '[t]he inconvenience and embarrassment of allowing two independent actions involving the same question of liability to proceed contemporaneously in different courts needs no elaboration.' From the parties' point of view, there is no less - perhaps, considerably more - inconvenience and embarrassment if the same issue is to be fought in the courts of different countries according to different regimes, very likely permitting of entirely different outcomes.

It is prima facie vexatious and oppressive, in the strict sense of those terms, to commence a second or subsequent action in the courts of this country if an action is already pending with respect to the matter in issue. And although there are cases in which it has been held that it is not prima facie vexatious, in the strict sense of that word, to bring proceedings in different countries, the problems which arise if the identical issue or the same controversy is to be litigated in different countries which have jurisdiction with respect to the matter are such, in our view, that, prima facie, the continuation of one or the other should be seen as vexatious or oppressive within the Voth sense of those words.

It does not follow that, because one or other of the proceedings is prima facie vexatious or oppressive within the Voth sense of those words, the local proceedings should be stayed. However, it does follow that the fact that there are or, even, that there may be simultaneous proceedings in different countries with respect to the same controversy is highly relevant to the question whether the local proceedings are oppressive in the sense of 'seriously and unfairly burdensome, prejudicial or damaging', or, vexatious, in the sense of 'productive of serious and unjustified trouble and harassment'. And it also follows that courts should strive, to the extent that Voth permits, to avoid that situation." [Footnotes omitted] [Emphasis added]

[63]

11. By this claim, the party (called the plaintiff) can claim damages or compensation against an accused in the criminal proceedings. This unique type of "civil claim" if filed before the same criminal Court which is deciding on the criminal liability. The plaintiff cannot issue an initial damages claim against a person who is not an accused in the primary criminal proceedings. The plaintiff can apply to join any of the accused to its claim at any time prior to judgment in the criminal proceedings.

12. The initial damages claim is commenced by the plaintiff lodging a statement of claim before the public prosecutor or the criminal court and paying a filing fee under article 22 of the UAE Criminal Procedure Law. The amount claimed can be increased at any time before judgment by submitting an amended statement of claim, and paying an increase in the filing fee. (The filing fee varies depending on the amount claimed.) Once the filing fee has been paid, the initial damages claim is on foot and must be determined by the Court. However, the claim can be discontinued by the plaintiff at any time prior to judgment.

13. When the initial damages claim is lodged, the public prosecutor does not have a discretion to refuse to allow the plaintiff to bring the initial damages claim.

14. The accused usually defends both the criminal and the 'initial damages claim' in the same criminal proceedings (i.e. there are no separate court proceedings for this). At the end of the trial the criminal Court will issue its judgment on the criminal liability, and may (i) uphold the 'initial damages claim'; or (ii) reject the 'initial damages claim'; or (iii) refer the 'initial damages claim' to the civil courts.

15. The plaintiff who has lodged an initial damages claim under article 22 of the UAE Criminal Procedure Law is not normally permitted to take an active role in proving criminal liability (this is the role of the public prosecutor). The plaintiff does not have any right to influence the timetable to be set by the criminal Court, although the plaintiff's lawyers are entitled to appear in the criminal Court, and to obtain copies of the prosecution documents."

[82]

44 Sixthly, it was submitted that Sunland is not assisted in its position by the fact that the Dubai World proceeding is on foot. This proceeding was commenced on 15 June 2010, approximately a year after this Australian proceeding. Ms Hamade's affidavit of 15 December 2011 sets out the circumstances relating to that claim.[60] Ms Hamade identifies that Sunland has three courses available to it in resisting the claim against it by Dubai World.[61] First, she says, Sunland can avoid liability by showing that one or more of the other defendants caused all the damage to Dubai World, and Sunland was not responsible for any of the damage. Secondly, Sunland can ask the Dubai court to divide liability between the defendants according to their responsibility for the damage. Thirdly, if the Dubai court funds that Sunland and the other defendants are liable to Dubai World then Sunland can ask the court to recover from other defendants, according to their responsibility for the damage, the money Sunland is required to pay to Dubai World. It was submitted that if the court were to grant an anti-suit injunction as sought, there would be nothing arising from that which would impede Sunland from advancing a contention against Dubai World that in fact Joyce or Reed or any of the other parties to this proceeding were responsible for the damage suffered by Dubai World. That case can still be made, it was said. As indicated previously, the Hamade affidavit identifies a second possible course,[62] which is that Sunland may ask the Dubai court to apportion liability to Dubai World between the defendants. Again, it was submitted that if the anti-suit injunction sought were to be granted, there was nothing to stop Sunland from advancing that contention. It is, it was submitted, effectively a proportionate liability contention, and one that can still be made. Another possible course is that Sunland might wish to pursue a third party claim or a counterclaim against another defendant.[63] This is, it was submitted, just an empty prospect in the absence of any assets in Dubai owned by Prudentia, Reed or Joyce, at least as far as any possible third party claim against them is concerned. There is, however, nothing to prevent Sunland, even if the anti-suit injunction were granted, to make a third party claim against, for example, Clyde and Co or any other party with assets in Dubai.

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