Plaintiff v Firstnamed Defendant Secondnamed Defendant

Plaintiff v Firstnamed Defendant Secondnamed Defendant - [2011] VSC 1 - VSC 2011 case summary — Zoe

[78]

"8 Recognition of foreign awards

(1) Subject to this Part, a foreign award is binding by virtue of this Act for all purposes on the parties to the arbitration agreement in pursuance of which it was made.

(2) Subject to this Part, a foreign award may be enforced in a court of a State or Territory as if the award were a judgment or order of that court.

...

(3A) The court may only refuse to enforce the foreign award in the circumstances mentioned in subsections (5) and (7).

(4) Where:

(a) at any time, a person seeks the enforcement of a foreign award by virtue of this Part; and

(b) the country in which the award was made is not, at that time, a Convention country;

this section does not have effect in relation to the award unless that person is, at that time, domiciled or ordinarily resident in Australia or in a Convention country.

(5) Subject to subsection (6), in any proceedings in which the enforcement of a foreign award by virtue of this Part is sought, the court may, at the request of the party against whom it is invoked, refuse to enforce the award if that party proves to the satisfaction of the court that:

(a) that party, being a party to the arbitration agreement in pursuance of which the award was made, was, under the law applicable to him or her, under some incapacity at the time when the agreement was made;

(b) the arbitration agreement is not valid under the law expressed in the agreement to be applicable to it or, where no law is so expressed to be applicable, under the law of the country where the award was made;

(c) that party was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present his or her case in the arbitration proceedings;

(d) the award deals with a difference not contemplated by, or not falling within the terms of, the submission to arbitration, or contains a decision on a matter beyond the scope of the submission to arbitration;

(e) the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties or, failing such agreement, was not in accordance with the law of the country where the arbitration took place; or

(f) the award has not yet become binding on the parties to the arbitration agreement or has been set aside or suspended by a competent authority of the country in which, or under the law of which, the award was made.

(6) Where an award to which paragraph (5)(d) applies contains decisions on matters submitted to arbitration and those decisions can be separated from decisions on matters not so submitted, that part of the award which contains decisions on matters so submitted may be enforced.

(7) In any proceedings in which the enforcement of a foreign award by virtue of this Part is sought, the court may refuse to enforce the award if it finds that:

(a) the subject matter of the difference between the parties to the award is not capable of settlement by arbitration under the laws in force in the State or Territory in which the court is sitting; or

(b) to enforce the award would be contrary to public policy.

(7A) To avoid doubt and without limiting paragraph (7)(b), the enforcement of a foreign award would be contrary to public policy if:

(a) the making of the award was induced or affected by fraud or corruption; or

(b) a breach of the rules of natural justice occurred in connection with the making of the award.

(8) Where, in any proceedings in which the enforcement of a foreign award by virtue of this Part is sought, the court is satisfied that an application for the setting aside or suspension of the award has been made to a competent authority of the country in which, or under the law of which, the award was made, the court may, if it considers it proper to do so, adjourn the proceedings, or so much of the proceedings as relates to the award, as the case may be, and may also, on the application of the party claiming enforcement of the award, order the other party to give suitable security.

...

9 Evidence of awards and arbitration agreements

(1) In any proceedings in which a person seeks the enforcement of a foreign award by virtue of this Part, he or she shall produce to the court:

(a) the duly authenticated original award or a duly certified copy; and

(b) the original arbitration agreement under which the award purports to have been made or a duly certified copy.

(2) For the purposes of subsection (1), an award shall be deemed to have been duly authenticated, and a copy of an award or agreement shall be deemed to have been duly certified, if:

(a) it purports to have been authenticated or certified, as the case may be, by the arbitrator or, where the arbitrator is a tribunal, by an officer of that tribunal, and it has not been shown to the court that it was not in fact so authenticated or certified; or

(b) it has been otherwise authenticated or certified to the satisfaction of the court.

..."

[84]

"10. I consider that the scheme of the Act is reasonably clear. A successful party to a New York Convention award, as defined in s 100(I) has a prima facie right to recognition and enforcement. At the first stage, a party seeking recognition or enforcement must, under s 102(1), produce the duly authenticated award or a duly certified copy and the original arbitration agreement or a duly certified copy. The arbitration agreement means an arbitration agreement in writing, as defined in s 5. Once such documents have been produced, recognition or enforcement may be refused at the second stage only if the other party proves that the situation falls within one of the heads set out in s 103(2). The issue before us concerns the content of and relationship between the first and second stages. The first stage must involve the production of an award which has actually been made by arbitrators. Mr de Garr Robinson accepted that it would not, for example, be sufficient to produce an award which had been forged. However, it must be irrelevant at that stage that the award is as a matter of law invalid, on any of the grounds set out in s 103(2), since otherwise there would have been no point in including s 103(2). The award so produced must also have been made by arbitrators purporting to act under whatever is the document which is at the same time produced as the arbitration agreement in writing. That, it seems to me, is probably sufficient to satisfy the requirement deriving from the combination of s 100(l) and s 102(l) to produce 'an award made, in pursuance of an arbitration agreement'. The words 'in pursuance of an arbitration agreement' could in other contexts require the actual existence of an arbitration agreement. But they can also mean 'purporting to be made under'. Construed in the latter sense the overlap and inconsistency to which I have referred are avoided. Any challenge to the existence or validity of any arbitration agreement on the terms of the document on which the arbitrators have acted fails to be pursued simply and solely under s 103(2)(b).

11. Sections 100-104 of the 1996 Act give effect to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 10 June 1958. Articles I-V of that convention are not perhaps as clearly in favour of the conclusion that I have indicated as Mr de Garr Robinson would suggest. Articles I and I1 refer to two separate documents, namely an award and an agreement, and art. I11 requires the production of each as necessary to obtain recognition or enforcement. Once again, however, Art. V(l)(a) makes clear that, at all events where an agreement apparently complies with the requirements of Art. II, any challenge to its validity is a matter for the party resisting recognition and enforcement to raise and prove. Distinguished commentators on the Convention also take this view: see in particular van den Berg, The New York Convention of 1958 (Kluwer), pp 250, 284 and 312 and 'The New York Convention of 1958, A Collection of Reports and Materials delivered at the ASA Conference held in Zurich on Feb. 2, 1996', para 106.

12. ... One cannot produce an agreement made otherwise than in writing. However, one can produce terms in writing, containing an arbitration clause, by reference to which agreement was (allegedly) reached, and one can produce a record of an arbitration agreement made in writing with (allegedly) the authority of the parties to it. That, it seems to me, is all that is probably therefore required at the first stage. That conclusion supports, rather than undermines, the further conclusion that, at the first stage, all that is required by way of an arbitration agreement is apparently valid documentation, containing an arbitration clause, by reference to which the arbitrators have accepted that the parties had agreed on arbitration or in which the arbitrators have accepted that an agreement to arbitrate was recorded with the parties' authority. On that basis, it is at the second stage, under s 103(2), that the other party has to prove that no such agreement was ever made or validly made.

...

15. ... Now, however, the standard procedure under Practice Direction - Arbitrations (Civil Procedure 2001, Vol. 2, Section 2B) is different. Unless the Court directs service on other parties under para 31.3, any application and order for recognition or enforcement is made without notice, with a proviso reflecting the respondent's right under para 31.9 to apply to set the order aside. By the time a respondent learns of the matter, therefore, it is too late for him simply to seek an adjournment of the actual application for recognition or enforcement. His only options are (a) to apply to set aside in England under s 103(2) and/or (b) to apply for a stay of the order for recognition or enforcement in England under s 103(5), pending determination of any application to set aside before the competent authority of the country (here Sweden) in which, or under the law of which, the award was made. A respondent may adopt the latter course alone and is under no duty to make any application to set aside in England. If a stay is granted and the foreign competent authority sets aside the award, the basis for the order recognizing or enforcing the award will have fallen away, and it can then be set aside on an application under s 103(2)(f)."

[104]

"33 The case of Sarhank Group v Oracle Corporation ('the Sarhank case') was a particularly interesting one. It was first heard by the US District Court for the Southern District of New York (see Yearbook Comm Arb'n XXVIII (2003) p 1043) and then on appeal by the US Court of Appeals for the Second Circuit, reported at [2005] USCA2 109; 404 F 3d 657 (2nd Cir, 2005). The facts were that in 1991, Sarhank Group ('Sarhank'), an Egyptian corporation, entered into a contract with Oracle Systems, Inc ('Systems'), which provided for arbitration in Egypt. Systems was a wholly owned subsidiary of Oracle Corporation ('Oracle'). The contract was governed by Egyptian law. In 1997, a dispute arose between Sarhank and Systems and Systems eventually terminated the contract. Sarhank then commenced arbitration proceedings against both Systems and Oracle at the Cairo Regional Centre for International Commercial Arbitration. Oracle objected to the arbitration, alleging that it was not a signatory to the contract. In 1991, the arbitral tribunal issued a unanimous decision against both Oracle and Systems. The arbitrators held that the arbitration clause in the contract between Sarhank and Systems was binding upon Oracle because Oracle was a partner with Systems in the relation with Sarhank. Oracle sought an annulment of the award before the Cairo Court of Appeal but the award was upheld.

34 Sarhank then sought enforcement of the Egyptian award before the US District Court for the Southern District of New York. The District Court granted enforcement. It dismissed Oracle's argument that the court should decide whether the arbitration agreement between the parties was valid in order to determine whether it had subject-matter jurisdiction to enforce the award under the Convention. The court reasoned that it was not asked to compel arbitration, in which case it would need first to decide whether the parties had agreed to arbitrate. Rather, the court was asked to enforce a foreign award in which the validity of the arbitration agreement had already been established under the laws of Egypt. The District Court concluded that in such a case it had original subject-matter jurisdiction under the Convention and turned to consider whether Oracle could establish any grounds for refusal of enforcement. I should note here that this decision was relied on by AVA below. The reasoning of the District Court was in line with that in the Dardana case ([31] supra) and this authority was relied on by the assistant registrar when he reached his decision."

[112]

"Under the Ordinance and the Convention, the primary supervisory function in respect of arbitrations rests with the court of supervisory jurisdiction as distinct from the enforcement court (see s 44(5) of the Ordinance; art VI of the Convention; Westacre Investments Inc v Jugoimport-SPDR Holding Co Ltd [1998] 3 WLR 770 at 808). But this does not mean that the enforcement court will necessarily defer to the court of supervisory jurisdiction.

The Convention distinguishes between proceedings to set aside an award in the court of supervisory jurisdiction (arts V(I)(e) and VI) and proceedings in the court of enforcement (art V(1)). Proceedings to set aside are governed by the law under which the award was made or the law of the place where it was made, while proceedings in the court of enforcement are governed by the law of that forum. The Convention, in providing that enforcement of an award may be resisted on certain specified grounds, recognises that, although an award may be valid by the law of the place where it is made, its making may be attended by such a grave departure from basic concepts of justice as applied by the court of enforcement that the award should not be enforced.

It follows, in my view, that it would be inconsistent with the principles on which the Convention is based to hold that the refusal by a court of supervisory jurisdiction to set aside an award debars an unsuccessful applicant from resisting enforcement of the award in the court of enforcement. See Firm P v Firm F YB Comm Arbn II (1977) 241 (where a German Court of Appeal refused to enforce an award which had been declared to be enforceable by a United States District Court). Even if the proposition stated above should be subject to some limitations, it must apply to a case where the party resisting enforcement is doing so on the ground of public policy. That is because the ground is expressed in the Convention (art V(2)(b)) as 'contrary to the public policy of the country', that is, the country in which enforcement is sought. In the court of supervisory jurisdiction, the public policy to be applied would be a different public policy, namely that of the supervisory jurisdiction.

In Paklito Investment Ltd v Klockner East Asia Ltd [1993] 2 HKLR 39 Kaplan J expressed (at 48-49) the view that a party faced with a Convention award against him has two options. He can apply to the court of supervisory jurisdiction to set aside the award or he can wait to establish a Convention ground of opposition. In my view, such a party is not bound to elect between the two remedies, at any rate when, in the court of enforcement, he seeks to rely on the public policy ground, as the respondent did here.

It follows also that a failure to raise the public policy ground in proceedings to set aside an award cannot operate to preclude a party from resisting on that ground the enforcement of the award in the enforcing court in another jurisdiction. That is because each jurisdiction has its own public policy.

What I have said does not exclude the possibility that a party may be precluded by his failure to raise a point before the court of supervisory jurisdiction from raising that point before the court of enforcement. Failure to raise such a point may amount to an estoppel or a want of bona fides such as to a justify the court of enforcement in enforcing an award (see Chrome Resources SA v Leopold Lazarus YB Comm Arbn XI (1986) 538 at 538-542). Obviously an injustice may arise if an award remains on foot but cannot be enforced on a ground which, if taken, would have resulted in the award being set aside."

[113]

"It has become fashionable to raise the specific grounds in s 44(2) (art V(1)(b)) which are directed to procedural irregularities, as public policy grounds (art V(2)(b)). There is no reason why this course cannot followed. The principal difference between s 44(2) and 44(3), it is suggested, is that, under section 44(3), the court of enforcement can take the point of its own motion (AJ van den Berg The New York Arbitration Convention of 1958, p 299). If, what the respondent seeks to do is to raise a specific ground under section 44(2) under the guise of public policy, then it is only right that it should bear the onus of establishing that ground.

In some decisions, notably of courts in civil law jurisdictions, public policy has been equated to international public policy. As already mentioned, art V(2)(b) specifically refers to the public policy of the forum. No doubt, in many instances, the relevant public policy of the forum coincides with the public policy of so many other countries that the relevant public policy is accurately described as international public policy. Even in such a case, if the ground is made out, it is because the enforcement of the award is contrary to the public policy of the forum (AJ van den Berg The New York Arbitration Convention of 1958, p 298).

However, the objective of the Convention was to encourage the recognition and enforcement of commercial arbitration agreements in international contracts and to unify the standards of which such agreements to arbitrate are observed and arbitral awards are enforced (Scherk v Alberto-Culver Co [1974] USSC 173; 417 US 506 (1974); Imperial Ethiopian Government v Baruch-Foster Corp [1976] USCA5 1064; 535 F2d 334 (1976) at 335). In order to ensure the attainment of that object without excessive intervention on the part of courts of enforcement, the provisions of art V, notably art V(2)(b) relating to public policy have been given a narrow construction. It has been generally accepted that the expression 'contrary to the public policy of that country' in art V(2)(b) means 'contrary to the fundamental conceptions of morality and justice' of the forum. (Parsons and Whittemore Overseas Co Inc v Société Générale de l'Industrie du Papier RAKTA [1974] USCA2 836; 508 F2d 969 (2d Cir 1974) at 974 (where the Convention expression was equated to 'the forum's most basic notions of morality and justice'); see AJ van den Berg The New York Arbitration Convention of 1958, p 376; see also Renusagar Power Co Ltd v General Electric Company YB Comms Arbn XX (1995) 681 at 697-702)).

The question then is whether the matters of which the respondent complains, namely the alleged refusal of the hearing and the communications to the chief arbitrator were contrary to the fundamental conceptions of morality and justice of Hong Kong. In this respect, the opportunity of a party to present his case and a determination by an impartial and independent tribunal which is not influenced, or seen to be influenced, by private communications are basic to the notions of justice and morality in Hong Kong."

[121]

"72. The final award is a Convention award which prima facie is entitled to enforcement in England under the Arbitration Act 1996, section 101(2). The principal issue is whether the courts below were right to find that the Government has proved that on the proper application of French law (as the law of the country where the award was made, since there is no indication in the Agreement as to the law governing the arbitration agreement), it is not bound by the arbitration agreement. To avoid any misunderstanding, it is important to dispel at once the mistaken notion (which has, it would appear, gained currency in the international arbitration world) that this is a case in which the courts below have recognised that the arbitral tribunal had correctly applied the correct legal test under French law. On the contrary, one of the principal questions before all courts in this jurisdiction has been whether the tribunal had applied French law principles correctly or at all.

73. The main issue involves consideration of these questions: (a) the role of the doctrine that the arbitral tribunal has power to determine its own jurisdiction, or Kompetenz-Kompetenz, or compétence-compétence; (b) the application of arbitration agreements to non-signatories (including States) in French law, and the role of transnational law or rules of law in French law; (c) whether renvoi is permitted under the New York Convention (and therefore the 1996 Act) and whether the application by an English court of a reference by French law to transnational law or rules of law is a case of renvoi.

74. There is also a subsidiary issue as to whether, even if the Government has proved that it is not bound by the arbitration agreement, the court should exercise its discretion ('... enforcement may be refused ...') to enforce the award.

...

92. This decision was applied in the international context, in connection with the enforcement of a CIETAC award, in China Minmetals Materials Import and Export Co Ltd v Chei Mei Corpn, [2003] USCA3 148; 334 F3d 274 (3d Cir 2003) in which Minmetals, a Chinese corporation, sought to enforce a CIETAC award against Chei Mei, a New Jersey corporation. Chei Mei resisted enforcement on the ground that the contract containing the arbitration clause had been forged. The tribunal had held that Chei Mei failed to show that the contracts were forged, but that even if its signature and stamp had been forged, it had taken various steps which confirmed its adherence to the arbitration agreement. The Court of Appeals for the Third Circuit decided that the court asked to enforce an award may determine independently the arbitrability of the dispute. After an illuminating discussion of the doctrine of compétence**-compétence and kompetenz-**kompetenz, it concluded (at 288, citing Park, Determining Arbitral Jurisdiction: Allocation of Tasks Between Courts and Arbitrators (1997) 8 Am Rev Int Arb 133, 140-142) that 'it appears that every country adhering to the competence-competence principle allows some form of judicial review of the arbitrator's jurisdictional decision where the party seeking to avoid enforcement of an award argues that no valid arbitration agreement ever existed.' The court said (ibid): 'After all, a contract cannot give an arbitral body any power, much less the power to determine its own jurisdiction, if the parties never entered into it.'"

[128]

59 The plaintiff submitted that to the extent that the Dallah case might be said to allow for re-agitation of all issues which were before the arbitral tribunal and to allow new and further evidence to be led, that case should be regarded as having been wrongly decided. In particular, it was said that it makes a mockery of sections like sub-s 8(8) of the IAA because it would give rise to a situation where a party seeking to challenge an award in the supervising court has, in fact, less rights than if the same challenge were made in the enforcing court. In the former case, it has to provide security in the enforcing jurisdiction under sub-s 8(8) while the challenge is made in the supervising court. In the latter case, it need provide no security, and potentially has wider appeal rights. It was submitted that this cannot be what the Australian Parliament, and the framers of the New York Convention, had in mind. It was also said to be inconsistent with the decision of Justice Prakash in Aloe Vera of America Inc v Asianic Food (S) Pte Ltd.[52] It was also submitted that the approach adopted in Aloe Vera of America Inc is one which was also applied in Svenska Petroleum Exploration v Government of the Republic of Lithuania[53] by Nigel Teare QC and in the second Svenska Petroleum decision[54] by Gloster J; and that this approach is to be preferred to that in Dallah's case. The distinction between the role of the supervising and enforcing court is similarly made in the judgment of Reyes J in A v R.[55] In my opinion it is clear from the judgments of the members of the Supreme Court in Dallah, that it is a decision which supports the latter approach, would not permit the unconstrained reopening of issues which were before the arbitral tribunal, and does not support the second defendant's submissions in support of the existence of 'threshold issue' under the equivalent of sub-s 8(1) of the IAA, which would cast a burden of proving, substantively, the elements of these provisions on the plaintiff.[56] Rather, in my view, Dallah supports the plaintiff's position.

[140]

"Held, dismissing the application to set aside:

(1) The court's role in an application for enforcement of a Mainland arbitral award under s 2GG of the Arbitration Ordinance (Cap 341) was essentially that of an overseer. The court would ensure that the arbitration was conducted fairly and in lending the means at the court's disposal, make the award effective. The court should not second-guess the award. The court should be as mechanistic as possible. Norsk Hydro ASA v State Property Fund of Ukraine [2002] EWHC 2120 (Comm) followed; Walker v Rome [1999] 2 All ER (Comm) 961; Gater Assets Ltd v Nak Naftogaz Ukrainiy [2008] EWHC 1108 (Comm) considered (paras 46-48).

(2) The court, when considering an application for enforcement of a Mainland arbitral award under s 2GG of the Ordinance, must be vigilant against attempts to go behind the award and re-argue matters which were either argued before the arbitrators or (if not) ought to have been argued before them, in the guise of dealing with questions of public policy. Each particular case must be scrutinised to see the extent to which (if at all) domestic public policy truly militated against (and was outraged by) the enforcement of a Mainland arbitral award. Unless an award was plainly incapable of performance such that it would be obviously oppressive to order a party to comply with it, the court could not, consistent with the mechanistic principle, hold that the award was contrary to public policy and refuse to convert the award into a judgment of the court. Where the best that could be said was that an award was arguably impossible, no compelling reasons for refusal of enforcement on public policy grounds could have been made out. Otherwise, the court would have to go behind the award, thereby allowing the re-opening of what the arbitrators had already decided. If a party to the arbitration genuinely believed that there was something impossible or somehow invalid about the award, then since the agreement as to the seat of an arbitration was analogous to an exclusive jurisdiction clause, it was incumbent upon that party to challenge the award in the court of the seat of arbitration, which in the present case would be the court in Beijing. It could not be for the court of enforcement to second-guess how the arbitral tribunal or the court of supervision at the seat of arbitration might assess the relevant facts and law in determining whether the alleged impossibility was substantive or fanciful. Hebei Import & Export Corp v Polytek Engineering Co Ltd [1999] HKCFA 40; [1999] 2 HKC 205, [1999] 1 HKLRD 665; A v B [2007] 1 Lloyd's Rep 237; C v D [2008] 1 Lloyd's Rep 239 applied (paras 51-54, 58, 62, 69)."

[143]

(i) Not only was the meaning of the terms of the arbitration agreement to be determined in accordance with Swiss law but so also was the effect of the alleged misrepresentation and duress or breach of the fiduciary duty on the enforceability of the arbitration agreement and the question whether, if proved, such misrepresentation, duress or breach of duty avoided the previous orders of the arbitrator;

(ii) Whether it should be the arbitrator or the court that decided in the first instance whether the arbitration agreement should be avoided ab initio or rescinded and, if the arbitrator, what right of recourse to the Swiss courts might be available to either parry who wished to challenge the arbitrator's decision would be determined in accordance with Swiss law exclusivity in the Swiss courts, Geneva being the place of the seat of the arbitration. For an agreement as to the seat of an arbitration is analogous to an exclusive jurisdiction clause. Any claim for a remedy going to the existence or scope of the arbitrator's jurisdiction or as to the validity of an existing interim or final award is agreed to be made only in the courts of the place designated as the seat of the arbitration. It is thus not merely, as was stated by Lord Phillips in the Court of Appeal judgment in this case, that the 'natural consequence' of the arbitration agreement was that any issue as to the validity of the arbitration provisions would fall to be resolved in Switzerland according to Swiss law, but that it would be a breach of agreement to invite the courts of any other place to resolve such an issue or at least to order a remedy founded on such resolution. This analysis reflects international arbitration practice over the entire period since the coming into effect of the New York Convention. The provisions of Article V of that Convention rest on that basis. In Naviera Amazonica Peruana SA v Compania Internacional de Seguros del Peru [1988] 1 Lloyd's Rep 116 Kerr LJ observed at page 119:

[151]

"100. Dallah relies in particular on international authorities relating to applications to annul awards on the basis that the matters decided by the arbitral tribunal exceeded the scope of the submission to arbitration: article V(1)(c) of the New York Convention; article 34 of the UNCITRAL Model Law. In Parsons & Whittemore Overseas Co Inc v Soc Gén de l'Industrie du Papier[1974] USCA2 836; , 508 F2d 969 (2d Cir 1974) the Court of Appeals for the Second Circuit, in dealing with an attack on a Convention award based on Article V(1)(c), said (at p 976) that the objecting party must 'overcome a powerful presumption that the arbitral body acted within its powers.' That statement was applied by the British Columbia Court of Appeal, in a case under article 34 of the Model Law as enacted by the International Commercial Arbitration Act, SBC 1986: Quintette Coal Ltd v Nippon Steel Corpn [1991] 1 WWR 219 (BCCA).

101. These cases are of no assistance in the context of a challenge based on the initial jurisdiction of the tribunal and in particular when it is said that a party did not agree to arbitration. Nor is any assistance to be derived from Dallah's concept of 'deference' to the tribunal's decision. There is simply no basis for departing from the plain language of article V(1)(a) as incorporated by section 103(2)(b). It is true that the trend, both national and international, is to limit reconsideration of the findings of arbitral tribunals, both in fact and in law. It is also true that the Convention introduced a 'pro-enforcement' policy for the recognition and enforcement of arbitral awards. The New York Convention took a number of significant steps to promote the enforceability of awards. The Geneva Convention placed upon the party seeking enforcement the burden of proving the conditions necessary for enforcement, one of which was that the award had to have become 'final' in the country in which it was made. In practice in some countries it was thought that that could be done only by producing an order for leave to enforce (such as an exequatur) and then seeking a similar order in the country in which enforcement was sought, hence the notion of 'double exequatur' (but in England it was decided, as late as 1959, that a foreign order was not required for the enforcement of a Geneva Convention award under the Arbitration Act 1950, section 37: Union Nationale des Co-opératives Agricoles des Céréales v Robert Catterall & Co Ltd [1959] 2 QB 44). The New York Convention does not require double exequatur and the burden of proving the grounds for non-enforcement is firmly on the party resisting enforcement. Those grounds are exhaustive.

102. But article V safeguards fundamental rights including the right of a party which has not agreed to arbitration to object to the jurisdiction of the tribunal. As van den Berg, The New York Arbitration Convention of 1958 (1981) puts it, at p 265: 'In fact, the grounds for refusal of enforcement are restricted to causes which may be considered as serious defects in the arbitration and award: the invalidity of the arbitration agreement, the violation of due process, the award extra or ultra petita, the irregularity in the composition of the arbitral tribunal or the arbitral procedure, the non-binding force of the award, the setting aside of the award in the country of origin, and the violation of public policy.' In Kanoria v Guinness [2006] 1 Lloyd's Rep 701, 706, May LJ said that section 103(2) concerns matters that go to the 'fundamental structural integrity of the arbitration proceedings.'

103. Nor is there anything to support Dallah's theory that the New York Convention accords primacy to the courts of the arbitral seat, in the sense that the supervisory court should be the only court entitled to carry out a re-hearing of the issue of the existence of a valid arbitration agreement; and that the exclusivity of the supervisory court in this regard ensures uniformity of application of the Convention. There is nothing in the Convention which imposes an obligation on a party seeking to resist an award on the ground of the non-existence of an arbitration agreement to challenge the award before the courts of the seat.

104. It follows that the English court is entitled (and indeed bound) to revisit the question of the tribunal's decision on jurisdiction if the party resisting enforcement seeks to prove that there was no arbitration agreement binding upon it under the law of the country where the award was made."

[155]

69 The plaintiff submitted that the crucial and simple point is that the Arbitral Tribunal has already decided the issue that the second defendant, IMC Solutions, seeks to agitate in this proceeding and that it is not for the plaintiff to lead extensive and further evidence (as the second defendant suggests) as to the process and the reasoning that the Arbitral Tribunal went through in coming to its findings in the Award. The Award is, it was submitted, undoubtedly valid and binding under Mongolian law. It was said that to the extent that the second defendant disputes this proposition, its remedy was to go to the Mongolian courts. In light of these authorities, the position is, in my view, that a party seeking to resist enforcement of an award is not entitled to relitigate and revisit the issues the subject of the arbitration; a position made clear, for example, by Lord Collins in Dallah Real Estate and Tourism Holding Company v Ministry of Religious Affairs, Government of Pakistan.[80] Clearly, if this were permitted, the utility of international arbitration would be diminished markedly as a result of the cost and delay of, in effect, repetition of the arbitration proceedings again before an enforcing court. This would be very reminiscent of the former case stated procedure which afflicted domestic arbitrations by allowing this to occur until merits appeals were constrained significantly by, for example, the Australian uniform domestic arbitration legislation.[81] The problem would be even more acute with international arbitration where there may be a multiplicity of national courts involved; the supervising court of the arbitral seat and possibly more than one enforcing court, depending upon matters such as the location of the award debtor's assets. It would, of course, be intolerable if the law was that an award creditor could be required to relitigate matters which were the subject of the arbitration; possibly many times and in a multiplicity of courts, and with the possibility of inconsistent findings. Thus, as Lord Collins said, the New York Convention introduced a "pro-enforcement" policy for the recognition and enforcement of foreign arbitral awards by, among other things, limiting the extent to which courts could examine the findings of and procedures applied by arbitral tribunals. This policy and approach manifests itself in Article V of the Convention and, in Australia, in sub-s 8(5) of the IAA. Consequently, a party seeking to resist the enforcement of an award is entitled to rely on the grounds provided for in the Convention, and in the legislation applying its provisions, but is not entitled to venture further towards reconsideration of the findings, substantive or procedural, of the arbitral tribunal.

[163]

"56 The fact that the Award may be final in Arizona does not therefore mean that Mr Chiew is excluded or precluded from resisting enforcement in Singapore. He may still resist enforcement of the Award provided that he is able to satisfy one of the Convention grounds under s 31(2) of the Act. The grounds on which enforcement of an award may be resisted under the Act, however, are not the same grounds that would entitle Mr Chiew to set aside the Award in the jurisdiction of the supervisory court. Whilst Mr Chiew's options may be cumulative, that does not mean that the bases on which the options may be exercised are or must be identical. Mr Chiew could have challenged the Award in Arizona on the basis that the Arbitrator had no jurisdiction to make the Award because Mr Chiew was not a party to the arbitration agreement. He may be able to resist enforcement here if he can establish that the arbitration agreement was 'not valid under the law to which the parties have subjected it' within the meaning of that phrase in s 31(2)( b). He is not, however, entitled to object to the initial grant of leave to enforce on the basis that the Arbitrator erred in holding that he was a party to the arbitration. As the enforcement court, I can only permit Mr Chiew to resist enforcement if he is able to establish one of the grounds set out in s 31(2) of the Act. Except to the extent permitted by those grounds, I cannot look into the merits of the Award and allow Mr Chiew to re-litigate issues that he could have brought up either before the Arbitrator or the supervisory court. As Mason NPJ also pointed out in the Hebei case, a party may be precluded by his failure to raise a point before the court of supervisory jurisdiction from raising that point before the court of enforcement. This is because failure to raise such a point may amount to an estoppel or a want of bona fides such as to justify the court of enforcement in enforcing an award. This, in fact, is what happened to the Government of Lithuania in the Svenska Petroleum case."

[172]

80 In relation to the applicable law, the second defendant argued against the application of the law of Mongolia as the lex arbitri on two bases. The first was that the arbitration agreement provisions contained in clause 16 of the OMA provided for Mongolian law or Hong Kong law as alternatives. It was submitted by the second defendant that Mongolian law had not been properly selected as the applicable law to the arbitration proceedings. Secondly, in terms of determining the validity of the arbitration agreement, it argued that as the OMA provides that the law applicable to that agreement is the law of Queensland, that is the law properly applied to determine the validity of the arbitration agreement as it might affect the second defendant. The consequences of this argument appear to be, on the basis of the second defendant's submissions, that either the Arbitral Tribunal failed to properly determine the issue according to and applying the law of Queensland or that this is a question for the enforcing court, in the context of the defence or ground for resisting enforcement raised by sub-s 8(5)(b) of the IAA, to determine in accordance with the law of Queensland. In my opinion this argument is not maintainable. It is noted that the second defendant disputes that there was any agreement for the purposes of clause 16 of the OMA to apply Mongolian law for the purposes of the arbitration,[95] and, of course, the second defendant says that it is not a party to the arbitration agreement contained in this clause. However, it is not put that the OAM, including clause 16, did not subsist, at least vis-à-vis the first defendant, IMC Mining. The authorities are clear that an arbitration agreement, contained in a broader agreement, is separable from the other terms of that agreement.[96] Consequently, this means that under clause 16 of the OMA the arbitral seat is Mongolia and the lex arbitri is, subject to the agreement of the parties, to be Mongolian or Hong Kong law.[97] In the absence of any agreement of the parties to the OMA this would leave the Arbitral Tribunal to determine the proper law to be applied to the remainder of the agreement according to choice of law rules applicable under the law of Mongolia. However, the parties have agreed that the law applicable to the agreement in this sense is the law of Queensland. Presumably under the Mongolian choice of law rules this agreement of the parties would be applied; but there is no evidence before the court on this issue. In any event, it is not an issue which is relevant to this application and need not be pursued. It is, nonetheless, important to note that the evidence of the Mongolian law expert relied upon by the second defendant, IMC Solutions, Professor Mendsaikhan Tumenjargel, indicates the question whether an entity that has not signed the relevant contract can be considered a party to an arbitration agreement contained in that contract is a matter for the law of Mongolia; the law agreed to be applicable to the agreement not being treated as of any relevance. Thus Professor Tumenjargel deposed:[98]

[195]

Whilst the decision of Batts J may have been reversed by the Court of Appeals, I respectfully agree with his observations which are in line with the general approach taken by an enforcement court to the decision of the arbitral tribunal in question. They are also consonant with the views of the court in the Hebei case which underline that the approach towards the decisions of foreign arbitral tribunals in Convention countries is to recognise the validity of the same and give effect to them subject to basic notions of morality and justice. The Court of Appeals in the Sarhank case took a different view, one that I hope will not be generally endorsed.

63. The only evidence that Mr Chiew adduced of the law of Arizona was contained in an affidavit filed by one Mr Steven Sullivan. Mr Sullivan was Mr Chiew's attorney in Arizona and, at the hearing below, it was conceded that Mr Sullivan was not acting as an expert but as an advocate for Mr Chiew. There was therefore no independent expert evidence from Mr Chiew on the law of Arizona as it applied to the Award. Also, as the assistant registrar found, Mr Sullivan's affidavit essentially contained a rehash of the arguments (based on Arizona laws, Arizona Rules of Civil Procedure and AAA rules) which were raised before the Arbitrator and, subsequently, adjudicated and rejected by the Arbitrator. Since Mr Chiew had not adduced expert evidence to show that the Arbitrator's findings are incorrect under Arizona law, I agree with the submission made by the plaintiff that there are no extraordinary circumstances warranting a review of the Award. I am not the supervisory court and cannot review the Arbitrator's decision in the same way that an Arizona court could. For me to refuse to enforce the Award on this ground, I would need to be satisfied that, under the law of Arizona, the arbitration agreement was invalid vis-à-vis Mr Chiew and that the Arbitrator was not entitled to find that Mr Chiew was a party to the Agreement and the arbitration. No basis has been given to me for such a finding." (footnotes omitted)

[198]

85 The plaintiff further submitted that both defendants attended and were legally represented at this hearing, by virtue of the representative for IMC Mining acting for or on behalf of IMC Solutions.[109] As discussed further below,[110] this depends in part on an initial characterisation of the representative signing for IMC Mining acting for or on behalf of IMC Solutions, such that any signature or acceptance of the outcome of this hearing by IMC Mining was also given on behalf of IMC Solutions. The document referred to in the preceding paragraph, however, does not of itself shed light on the involvement or nature of any relationship of agency, alter ego, or any other form of relationship which the plaintiff argues IMC Mining agreed, assumed or entered into for and on behalf of IMC Solutions. Mr Stewart Charles Lewis, the present CEO of IMC Solutions, and the managing director of IMC Mining from 27 June 2007 to 4 September 2009, deposed that the document contained the signature of the first defendant's representative, Mr Bevan Jones, of IMC Mining, and that of its legal representative, Mr Bayartseteg of the Mongolian law firm Lehman, Lee & Xu ("Lehman"). Mr Lewis stated that these signatures were solely on behalf of IMC Mining, and not "on behalf of the Defendants" (as Mr Batdorj deposed to in the first Batdorj affidavit).[111] Mr Jones was appointed by Mr Lewis to manage the arbitration on IMC Mining's behalf. Mr Jones deposed that he attended this meeting on behalf of IMC Mining, and stated that he was not notified or made aware that any claim was made directly against IMC Solutions. Mr Jones exhibited a power of attorney, appointing Lehman, to act for and in relation to this preliminary hearing, and the arbitral proceedings generally, on behalf of IMC Mining.[112] The power of attorney contains very broad provisions with respect to Lehman's powers, together with more specific (but inclusive, rather than exclusive provisions) for "mediating communication with, raising questions from, exchanging information with and submitting explanations to the Client and others, when and where necessary" (emphasis added). No direct affidavit or other supporting evidence was provided by Lehman; which was surprising in all the circumstances, particularly having regard to the ambit of that firm's instructions and role, as apparently indicated by the power of attorney provisions.[113] Having regard to the onus of proof the second defendant must meet, particularly in the face of contrary evidence, and with reference to my findings below,[114] insofar as the evidence is inconsistent, I prefer the evidence of Mr Batdorj. In coming to this finding as to the preliminary hearing, I rely particularly on the first-hand nature of Mr Batdorj's evidence about the hearing, and the lack of similar directly responsive evidence adduced by the second defendant. It is apparent that Mr Batdorj attended the preliminary hearing in his capacity as the plaintiff's representative. By contrast, Mr Lewis, who assiduously denied the assertions that IMC Mining acted for or on behalf of IMC Solutions at this meeting, was not present at the meeting, and deposed that although he was "from time to time consulted about the progress", as he was not resident in Mongolia, he left the management of the arbitration "principally" to Mr Jones.[115] Furthermore, no direct evidence supporting Mr Lewis' denials, or evidence contrary to that of Mr Batdorj in this respect, was forthcoming from any of the then employees or contractors of either of the defendants who were present at the hearing. As the plaintiff submitted, nowhere does Mr Jones rebut the evidence of Mr Batdorj that he was acting for both defendants and support the evidence of Mr Lewis that he did not have authority, nor purport to act on behalf of, the second defendant, IMC Solutions. Furthermore, no evidence was led from the Mongolian law firm (Lehman) which represented IMC Mining at this hearing, which would have assisted in clarifying the scope of its representation, if any, of the second defendant. Consequently I find that at the preliminary hearing on 24 July 2009 it was agreed, amongst other things, that between IMC Mining, IMC Solutions, and the plaintiff:

[212]

89 In response to the second defendant's submissions, the plaintiff referred to what it deemed a paucity of evidence presented by the second defendant, entitling the court, in its opinion, to draw the inference that evidence not adduced by the second defendant, would not have supported its case.[123] It submitted that despite the voluminous documentary material initially identified by the second defendant in these proceedings, the final affidavit material presented by the second defendant contains very little in the way of documentation, and as such, it can reasonably be inferred that the documents that were put before the court are "presumably [the second defendant's] high watermark".[124] It was further submitted that the second defendant, despite foreshadowing that further information was being sought from a number of potentially relevant parties, did not present evidence from key employees, lawyers or contractors, and in the present context, particularly those who were present at the arbitration and had (on the basis of the second defendant's assertions as to the true position) the ability to directly rebut the assertions made in the Batdorj affidavits.[125] Particular reference was made to the absence of any evidence given by Mr Pat Kelly, who worked full-time on the mining project and participated in drafting the OMA, which contained the arbitration clause, and was present at its execution; in addition to holding himself out as a representative of IMC Solutions at various times.[126] The plaintiff further submitted that the second defendant failed to provide an explanation as to why such affidavit material was not made available, nor seemingly relevant witnesses called.[127] Reference was also made to the second defendant's lack of particulars as to an unspecified dispute that arose with Lehman, the Mongolian law firm retained for the period of the arbitration, such that no evidence beneficial to the second defendant's case was adduced.[128] A more detailed review of the evidence is set out below.[129] At this stage, I note simply the direct nature of Mr Batdorj's evidence; given by a party who was employed by the plaintiff during the relevant period, and who attended the hearings in question, in contradistinction to the lack of any evidence adduced by the second defendant that directly contradicted the evidence of Mr Batdorj, or provide an objective basis establishing a contrary position.

[240]

105 The plaintiff's response to the evidence on behalf of the second defendant, IMC Solutions, in the form of the affidavits of Mr Stewart Lewis and Mr Bevan Jones, was that they were "both disingenuous and show a remarkable lack of candour". It was said that the exhibits to both of these affidavits provide ample evidence of the role of the second defendant in the conduct of the arbitration and in relation to the performance of the OMA.[154] It was contended that both Mr Lewis and Mr Jones had been representing on the internet, as recently as two weeks prior to the hearing of this matter in the court on 4 November 2010, that the second defendant, IMC Solutions, was the moving party and the real contractor on the Tayan Nuur Iron Ore Project in Mongolia.[155] It was also submitted also that there is no direct credible evidence to support the second defendant's case that it was only a sub-contractor. In particular, reference was made in the evidence of Mr Batdorj[156] to the evidence of Mr Lewis that Mr Bevan Jones "was not, and never had been, employed by IMC Solutions or engaged by them as a contractor or consultant, and was not authorised to act for IMC Solutions". Mr Batdorj said that this was not correct and made reference to an exhibited document[157] entitled "Reporting of Resources / JORC Standard", under which the name "Bevan Jones / IMC Mongolia" appears. At the foot of each of its twenty-five pages an "IMC" firm graphic or logo appears, as well as the company name "IMC Mining Solutions Pty Ltd". Additionally, specific reference was made to the document titled: "IMC - Weekly Report for the WE 31-01-2009 to Altain Khuder LLC" bearing the name "IMC Mining Solutions Pty Ltd".[158] Although Mr Lewis did concede that the defendants, IMC Mining and IMC Solutions, and IMC Mongolia, did use a common logo, it was said that this was "no more than a common marketing approach of the companies".[159] This Weekly Report, on the other hand, appears to indicate more than merely a marketing aspect in relation to its use in common. In addition, the plaintiff submitted, the use of the term "IMC" in the "IMC Response to AKL Arbitration Claim" document constituted a reference to the second defendant, IMC Solutions.[160] If proven, this would indicate that IMC Solutions was aware of, clearly had notice of, and was involved in the arbitration from an early stage in the arbitral process. On its face, the "IMC Response to AKL Arbitration Claim" document appears to indicate that the term "IMC" is used in a manner consistent with it being a reference to both defendants, IMC Mining and IMC Solutions. IMC Mongolia is referred to specifically, as is IMC Mining, on two occasions (under the heading "Item 2 - Establishment of IMC Mongolia"), in contradistinction to the use of "IMC" otherwise. The evidence of the way in which the IMC logo and brand were used, in my opinion, supports the suggestion that IMC Solutions and IMC Mining acted as some form of common enterprise or operated under some other relationship of legal responsibility (or are estopped from asserting otherwise).[161] Such a characterisation is consistent with the conclusion the plaintiff asks the court to draw, and is congruent with the evidence below.[162]

[247]

110 In light of the evidentiary matters already considered and the matters set out in the plaintiff's submissions, to which reference has been made, I accept them as an accurate analysis of the state of the evidence. I am also assisted by the extensive submissions extracted and summarised above,[171] which largely also apply to the issue of whether the second defendant received proper notice; particularly the evidence which goes towards establishing that IMC Solutions and IMC Mining were, for all intents and purposes treated as the same entity, or are estopped from asserting otherwise. In my view, on the basis of the lack of persuasive and complete evidence presented by the second defendant, and the fact that it bears the onus of establishing a defence or ground against enforcement of the Award, I accept the evidence of the plaintiff's witness, Mr Batdorj. I note, again, the direct and very specific nature of Mr Batdorj's evidence; given by a party who was employed by the plaintiff during the relevant period, and who attended the hearings in question. This stands in stark contradistinction to the lack of evidence adduced by the second defendant that directly and specifically challenged the evidence of Mr Batdorj, or provided an objective basis of proof of the contrary position. Thus, in the circumstances of the evidence presented, I am not satisfied that the second defendant has discharged the onus of proof it bears in resisting enforcement of the Award. Further, though the plaintiff does not bear the burden in this respect, on the basis of the evidence which I accept, it is, in my view, more probable than not that the second defendant was well aware of the nature and progress of the arbitration proceedings and was well able to present its case in the arbitration proceedings. As a result, it is not open to the defendant to rely on the defence or ground that it did not receive proper notice, nor a chance to be heard, given the state of the evidence, and the overall evidentiary onus it faces. Consequently, I am of the opinion that the second defendant, IMC Solutions, has failed to establish this defence or ground against enforcement.

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