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Recommendation in The Netherlands to suspend intercountry adoptions

The Committee Investigating Intercountry Adoption, has recommended that The Netherlands suspend intercountry adoptions. The interdisciplinary committee considered the history and legal evolution, and did an in-depth investigation into adoptions from five selected countries (Bangladesh, Brazil, Colombia, Indonesia and Sri Lanka). It looked into the consequences for the people involved (adoptees, birth families and adoptive families), the perception in society, the best interests of the child and the right to know one’s origins and identity. It came to the conclusion that there have been too many abuses and that the current system is still open to fraud and abuses. It further stated that the lessons learned should be applied to new methods of family formation such as surrogacy.

For those who do not read Dutch, the Commission issued a press release in English and published an English summary of the report.

The Committee, established by the Minister for Legal Protection, Mr. Sander Dekker, was chaired by Mr. Tjibbe Joustra and further composed of Prof. Dr. Beatrice de Graaf and Mr. Bert-Jan Houtzagers.

Mareva injunctions, submission and forum non conveniens

Written by Marcus Teo (Sheridan Fellow (Incoming), National University of Singapore)

The law in Singapore on Mareva injunctions supporting foreign proceedings is on the move again. The High Court’s recent decision in Allenger v Pelletier [2020] SGHC 279, issued barely a year after the Court of Appeal’s decision in Bi Xiaoqiong v China Medical Technologies [2019] 2 SLR 595; [2019] SGCA 50 (see previous post here) qualifies the latter, confounding Singapore’s position on this complex issue even further.

Pelletier sold shares to buyers in Florida while allegedly misrepresenting the company’s value. The buyers obtained arbitral awards against him, then obtained a bankruptcy order against him in the Cayman Islands. By this time, however, Pelletier had initiated several transfers, allegedly to dissipate his assets to Singapore among other jurisdictions. The buyers then initiated proceedings to clawback the transfers in the Cayman courts, and obtained a worldwide Mareva injunction there with permission to enforce overseas. Subsequently, the buyers instituted proceedings in Singapore against Pelletier in Singapore based on two causes of action – s 107(1) of the Cayman Bankruptcy Law (the “Cayman law claim”), and s 73B of Singapore’s Conveyancing and Law of Property Act (the “CLPA claim”) – and applied for a Mareva injunction to freeze his Singapore assets.

Senior Judge Andrew Ang acknowledged that “the Mareva injunction remains, at its very core, ancillary to a main substantive cause of action.” (Allenger, [125]). In doing so, he remained in step with Bi Xiaoqiong. Ang SJ eventually held that Mareva could be sustained based on the CLPA claim. However, he reasoned that the Cayman law claim could not; it is this latter point that is of relevance to us.

Ang SJ first held that the court had subject-matter jurisdiction over the Cayman law claim, because Singapore’s courts have unlimited subject-matter jurisdiction over any claim based on statute or common law, whether local or foreign. The statute that defined the court’s civil jurisdiction – Section 16(1) of the Supreme Court of Judicature Act (“SCJA”) – implicitly retained the position at common law, that the court possessed a generally “unlimited subject-matter jurisdiction”, while expressly defining only the court’s in personam jurisdiction over defendants ([45], [51]-[52]). The only limits on the court’s subject-matter jurisdiction, then, were those well-established in the common law, such as the Mozambique rule and the rule against the justiciability of foreign penal, revenue and public law claims ([54]). This was a conception of international jurisdiction organised primarily around control and consent rather than sufficient connections between causes of action and the forum, although Ang SJ’s recognition of the abovementioned common law exceptions suggests that a connection-based notion of jurisdiction may have a secondary role to play.

However, Ang SJ then held that the court could not issue a Mareva injunction against Pelletier, because, as all parties had accepted, Singapore was forum non conveniens. This is where the difficulty began, because the court’s reasoning here was anything but clear. At times, Ang SJ suggested that Singapore being forum non conveniens precluded the existence of the court’s jurisdiction over Pelletier; for instance, he dismissed the buyer’s arguments for a Mareva injunction based on the Cayman law claim on grounds that “Singapore court would first have to have in personam jurisdiction over a defendant before it could even grant a Mareva injunction” ([145]). At other times, however, Ang SJ suggested that Singapore being forum non conveniens only prevented the court from “exercising its jurisdiction” over Pelletier ([123], emphasis added). The former suggestion, however, would have been misplaced: as Ang SJ himself noted ([114]), Pelletier had voluntarily submitted to proceedings, which gave the court in personam jurisdiction over him. That Ang SJ would otherwise have refused the buyers leave to serve Pelletier should also have been irrelevant: Section 16(1) of the SCJA, mirroring the position at common law, gives Singapore’s courts “jurisdiction to hear and try any action in personam where (a) the defendant is served with a writ of summons or any other originating process … or (b) the defendant submits to the jurisdiction of the [court]” (emphasis added).

Ang SJ’s objection, then, must have been the latter: if a court will not to exercise its jurisdiction over a defendant, it should not issue a Mareva injunction against him. This conclusion, however, is surprising. Ang SJ considered himself bound to reach that conclusion because of the Court of Appeal’s holding in Bi Xiaoqiong that “the Singapore court cannot exercise any power to issue an injunction unless it has jurisdiction over a defendant” (Bi Xiaoqiong, [119]). Yet, this hardly supports Ang SJ’s reasoning, because Bi Xiaoqiong evidently concerned the existence of jurisdiction, not its exercise. There, the Court of Appeal simply adopted the majority’s position in Mercedes Benz v Leiduck [1996] 1 AC 284 that a court need only possess in personam jurisdiction over a defendant to issue Mareva injunctions against him. It was irrelevant that the court would not exercise that jurisdiction thereafter; even if the court stayed proceedings, it retained a “residual jurisdiction” over them, which sufficed to support a Mareva injunction against the defendant (Bi Xiaoqiong, [108]). Indeed, in Bi Xiaoqiong itself the court did not exercise its jurisdiction: jurisdiction existed by virtue of the defendant’s mere presence in Singapore, and the plaintiff itself applied to stay proceedings thereafter on grounds that Singapore was forum non conveniens (Bi Xiaoqiong, [16], [18])

Ang SJ’s decision in Allenger thus rests on a novel proposition: that while a defendant’s presence in Singapore can support a Mareva against him even when Singapore is forum non conveniens, his submission to proceedings in Singapore cannot unless Singapore is forum conveniens, though in both situations the court has in personam jurisdiction over him. Moreover, while Ang SJ’s decision may potentially have been justified on grounds that the second requirement for the issuance of Mareva injunctions in Bi Xiaoqiong – of a reasonable accrued cause of action in Singapore – was not met, his reasoning in Allenger, in particular the distinction he drew between presence and submission cases, was directed solely at the first requirement of in personam jurisdiction. On principle, however, that distinction is hard to defend: in both scenarios, the court’s jurisdiction over the defendant derives from some idea of consent or control, and not from some connection between the substantive cause of action and the forum. If like is to be treated alike, future courts may have to relook Ang SJ’s reasoning on this point.

What was most surprising about Allenger, however, was the fact that Ang SJ himself seemed displeased at the conclusion he believed himself bound to reach. In obiter, he criticised Bi Xiaoqiong as allowing the “‘exploitation’ of the principle of territoriality by perpetrators of international frauds” (Allenger, [151]), and suggested that Bi Xiaoqiong should be overturned either by Parliament or the Court of Appeal ([154]). In the process, he cited Lord Nicholls’ famous dissent in Leiduck, that Mareva injunctions should be conceptualised as supportive of the enforcement of judgments rather than ancillary to causes of action (Leiduck, 305). The tenor of Ang SJ’s statements thus suggests a preference that courts be allowed to issue free-standing Mareva injunctions against any defendant with “substantial assets in Singapore which the orders of the foreign court … cannot or will not reach” (Allenger, [151]). Whether the Court of Appeal will take up this suggestion, or even rectify the law after Allenger, is anyone’s guess at this point. What seems clear, at least, is that Singapore’s law on Mareva injunctions supporting foreign proceedings is far from settled.

RCD Holdings Ltd v LT Game International (Australia) Ltd: Foreign jurisdiction clauses and COVID-19

By Jie (Jeanne) Huang, Associate Professor, University of Sydney Law School Australia

In 2013, the plaintiffs, ePayment Solutions Pty Ltd (EPS) and RCD Holdings Ltd (RCD) concluded a written contract with the defendant, LT Game International (Australia) Ltd (LT) about the development and installation of a computer betting game. LT is a company incorporated in the Virgin Islands and registered in Australia as a foreign company. The contract was signed in Australia. Its Clause 10 provides.

10. Governing Law

Any dispute or issue arising hereunder, including any alleged breach by any party, shall be heard, determined and resolved by an action commenced in Macau. The English language will be used in all documents.”

When a dispute arose, the plaintiffs commenced the proceedings at the Supreme Court of Queensland in Australia ([2020] QSC 318). The defendant entered a conditional appearance and applied to strike out the claim, or alternatively, to have it stayed as being commenced in this court contrary to the contract. This case shed useful light on how an Australian court may address the impacts of COVID-19 on foreign jurisdiction clauses.

The parties did not dispute that Clause 10 was an exclusive jurisdiction clause choosing courts in Macau China. However, an exclusive foreign jurisdiction clause does not exclude Australian courts’ jurisdiction. The plaintiffs alleged that the Supreme Court of Queensland should not enforce the exclusive jurisdiction clause due to the COVID?19 pandemic for two reasons.

First, the pandemic currently prevents the plaintiffs from commencing proceedings in Macau. The court rejected this argument because no evidence suggested that representatives of the plaintiffs had to be present in Macau for lawyers retained by them to commence proceedings.

Second, plaintiffs also alleged that their witnesses could not travel from Australia to Macau because of the pandemic. The court also rejected this argument because of insufficient evidence. According to the court, the plaintiffs did not provide any evidence of the impact of COVID?19 in Macau, for example, what restrictions were being experienced now, what restrictions were likely to be experienced in the future and how long those restrictions may persist. There was also no evidence showing when a trial of proceedings commenced now in Macau might be heard. Although Australian witnesses might be called in the Macau proceedings, the plaintiffs did not identify any specific persons who would be called were residents in Australia. It was also unclear whether overseas witnesses might be called if the proceedings were conducted in Australia as Australia also imposed strict travel restrictions.

Finally, the court ruled for the defendant and dismissed the plaintiffs’ claim. Nevertheless, the court indicated that the plaintiffs could recommence the proceedings in Queensland if the circumstances of the COVID-19 pandemic changed materially in Macao in the future.

Comments:

It is well established that an exclusive foreign jurisdiction clause does not operate to exclude Australian courts’ jurisdiction; however, the courts will hold the parties to their bargain and grant a stay of proceedings, unless the party who seeks that the proceedings be heard in Australia can show that there are strong reasons against litigating in the foreign jurisdiction.[1] In exercising its discretion, the court should take into account all the circumstances of the particular case. However, doubts have been cast as to whether courts should consider financial or forensic inconvenience attaching to the nominated foreign jurisdiction, at least when these factors should have been known to the parties at the time the exclusive jurisdiction clause was agreed by them.[2]

In RCD, the court correctly held that Clause 10 should be interpreted as manifesting an intention that disputes would be determined in Macau by applying the law of Macau. Although the application of Macau law might bring financial benefits to the defendant because it is more difficult to prove liability for damages under the Macau law than the law in Australia. However, this is insufficient to convince the court to exercise jurisdiction because the potential financial benefits for the defendant are what the parties have bargained for.

Regarding the location of witnesses, the court is also correct that parties should expect that breaches may occur in Australia as the contract would be partially performed there, and consequently, witnesses in Australia may need to be called for proceedings in Macao. Therefore, the location and travel of witnesses are not a strong reason for Australian courts to exercise jurisdiction.

The outbreak of the COVID-19 pandemic is a factor that parties could not reasonably expect when they concluded their foreign jurisdiction clause. If a plaintiff wants to convince an Australian court to exercise jurisdiction in spite of an exclusive foreign jurisdiction clause, this plaintiff must provide solid evidence of the impacts of the COVID-19 pandemic on foreign proceedings. If the plaintiff can show that the pandemic developed so as to effectively prevent, or unduly frustrate the plaintiff in litigating in the foreign jurisdiction, then that might be a discretionary consideration, with any other relevant considerations, in favor of allowing the plaintiffs to litigate in Australia.

[1] High Court of Australia decisions such as Akai Pty Ltd v People’s Insurance Co Ltd (1996) 188 CLR 418 at 445, Oceanic Sunline Special Shipping Company Inc v Fay (1988) 165 CLR 197 at 259, Huddart Parker Ltd v The Ship Mill Hill (1950) 81 CLR 502 at 508-509.

Decisions of intermediate courts of appeal such as Global Partners Fund Ltd v Babcock & Brown Ltd (in liq) & Ors (2010) 79 ACSR 383 at 402-403, [88]-[89], Australian Health & Nutrition Association Ltd & Anor v Hive Marketing Group Pty Ltd & Anor (2019) 99 NSWLR 419 at 438, [78], Venter v Ilona MY Ltd [2012] NSWSC 1029.

[2] Incitec Ltd v Alkimos Shipping Corp (2004) 138 FCR 496 at 506 and Australian Health & Nutrition Association Ltd & Anor v Hive Marketing Group Pty Ltd & Anor (2019) 99 NSWLR 419.

News

CCTL Cross-Border Legal Issues Dialogue Seminar Series – ‘Parallel Proceedings between International Commercial Litigation and Arbitration’ by Dr. Guangjian Tu (Recording Released)

Parallel proceedings in international commercial litigation between the courts of different countries have long been discussed and explored, for which the Brussels I Regulation in the EU provides a good model for solution although it is still a problem at the global level and an obstacle for the Hague Jurisdiction Project.

However, it seems that so far no enough attention has been paid to the problem of parallel proceedings between international commercial litigation and arbitration. Theoretically, parties’ consent to arbitration will exclude the jurisdiction of states’ courts by virtue of the rules set out in Article 2 of the New York Convention altogether. But the Convention fails to successfully eradicate parallel proceedings between arbitral tribunals and state courts, owing to its inherent defects. When a conflict arises between international commercial arbitration and litigation proceedings, a rational balance must be struck between the judiciary and the arbitral tribunal with a reasonable division of competence between the two bodies. Different from parallel proceedings between two courts of different countries where usually both have jurisdiction and the question is only who should decide first, the jurisdiction of a national court and that of an arbitral tribunal excludes each other; similar to them, the problems with the former will also happen to the latter. Shall one always give “priority” to the arbitral tribunal to decide i.e. the issue of validity of the arbitration agreement for the purpose of respecting the doctrine of competence/competence? Can a simple lis pendens rule like that under the Brussels I Regulation work i.e. a national court or arbitral tribunal whoever is seized earlier shall decide when the issue of the validity of arbitration agreement is raised as a preliminary question in the national court? This presentation will try to explore an ideal model for the solution to this problem.

The recording can be found here. Read more

Hague Conventions on International Civil Procedure – a Pathway to Adoption in New Zealand (Seminar)

This Friday (12 April) at 3 pm (NZST), Jack Wass and Maria Hook will be giving a seminar at the University of Otago (New Zealand) on their project “Hague Conventions on International Civil Procedure – Pathway to Adoption”. This project, which is funded by the Borrin Foundation, explores a pathway for New Zealand to adopt four key treaties on international civil procedure developed by the Hague Conference on Private International Law – the Service Convention 1965, the Evidence Convention 1970, the Choice of Court Convention 2005, and the Judgments Convention 2019. The purpose of the project is to try and dislodge the inertia within the executive that has resulted in consideration of these Conventions stalling, by producing a briefing paper and draft legislation for the implementation of the treaties. The seminar will focus on the proposed pathway for adoption of the Conventions and discuss its potential effectiveness in encouraging New Zealand’s participation in international treaties.

There is a Zoom link available for anyone who would like to attend the seminar but is unable to do so in person. Please contact me if you would like to attend.

Badr on Religion, Colonialism, and Legal Pluralism: The Story and Legacy of the Egyptian Choice of Law Rules for Personal Status International and Interpersonal Conflicts of Law

Yehya Badr (Associate Professor, College of Law, Al-Yamamah University, KSA) presents his recent publication entitled “Religion, Colonialism, and Legal Pluralism: The Story and Legacy of the Egyptian Choice of Law Rules for Personal Status International and Interpersonal Conflicts of Law“, published in the Indiana Journal of Global Legal Studies, Issue 1 of Volume 31, 2024. The paper addresses the important issue of Egyptian choice of law rules for international and interpersonal conflicts of law.

The detailed summary, kindly provided by the author, reads as follows: Read more

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