Conflict of Laws
| Author | Joel LEE Tye Beng LLB (Hons) (Wellington), LLM (Harvard), DCH (AIH); Barrister and Solicitor (New Zealand), Advocate and Solicitor (Singapore); Associate Professor, Faculty of Law, National University of Singapore. |
| Date | 01 December 2011 |
| Published date | 01 December 2011 |
10.1 For 2011, there are fifteen cases which will be examined in this review.
10.2 As in previous years, it is useful to note that conflict of laws cases sometimes relate to other areas of law. In these situations, this review will only examine those parts of the case that are relevant to the field of conflict of laws.
Forum non conveniens
10.3 There are a number of strategic choices that are available to a defendant when faced with a suit in the Singapore courts. One option is to apply to the court to stay the proceedings based on forum non conveniens. Yap Shirley Kathreyn v Tan Peng Quee[2011] SGHC 5 is a clear illustration of such an application. In this case, the plaintiff sued the defendant in Singapore for amounts due under a partnership agreement and the defendant cross-sued in the Malaysian courts. The defendant applied to the Singapore courts to stay the proceedings. The assistant registrar granted the application which was upheld on appeal by Choo Han Teck J. By way of summary, in an application for stay of proceedings based on forum non conveniens, the defendant has the burden of proving that there was a distinctly more appropriate forum elsewhere. If this is established, then the plaintiff has to show that there were valid reasons or circumstances based on the ends of justice, why the court should nonetheless not grant a stay. In this case, the court decided that Malaysia was the natural forum based on where the partnership was formed, where the witnesses resided and the desire to avoid duplicity of proceedings which might lead to inconsistent decisions and thereby adversely affect comity. In the absence of reasons and circumstances why a stay should not be allowed, the defendant's application was granted.
Application of forum non conveniens in the family law context
10.4 Applications for a stay of proceedings based on forum non conveniens also often surface in the context of family law. In AQD v AQE[2011] SGHC 92, the parties, both foreign nationals, each filed for divorce in Singapore and England. While there were also applications for custody, care and control, and access, the main question before the court was whether the divorce proceedings should be heard in Singapore or England. This case is instructive in that the court reconfirms the position that the court that would hear the main matter would also hear the ancillary matters and this is in the greater service of ensuring the fairest and most expeditious way of adjudicating the entire action. What is striking in this case is that the court adopted a robust and forward looking approach to the determination of which jurisdiction was the natural forum. Choo Han Teck J took into account the intended relocation of the wife and the children to England (pointing towards England as the English courts could better determine the best interests of the children in the light of the wife's lifestyle and children's new schooling schedule), the no fault basis for divorce in both England and Singapore (making the location of evidence and witnesses a neutral point as both parties acknowledged that the marriage had broken down irretrievably) and the location of assets (pointing to the English courts being more able to anticipate the future conduct and circumstances of the parties taking into account the standard of living in England and the potential earning capacity of parties in their respective contexts).
Order 11 application and forum conveniens
10.5 When a party seeks to serve proceedings out of the jurisdiction under O 11 of the Rules of Court (Amendment) Rules 2011 (Cap 322, S75/2011) the doctrine of forum non conveniens is also relevant. As part of establishing the requirements for service out of the jurisdiction, the plaintiff must show that Singapore is the forum conveniens for the dispute. In ITC Global Holdings Pte Ltd (in liquidation) v ITC Ltd[2011] SGHC 150, the plaintiff (a commodities trading company incorporated in Singapore) commenced proceedings against the defendant (the sole shareholder of the plaintiff and incorporated in India). The plaintiff had alleged that the defendant had caused it to grant advances to a third party thereby benefiting from it directly, but with no commercial benefit to the plaintiff. The causes of action included tort, contract, restitution, breach of fiduciary duties and breach of statutory duties under the Companies Act (Cap 50, 1994 Rev Ed).
10.6 There was no dispute that the matters fell within the nexuses provided by O 11 and that there was a sufficient degree of merit in the claim. While it was argued that there was a non-disclosure of material facts, the court found that this allegation was unfounded. As such, the only requirement of an O 11 application for service out of the jurisdiction that was in question was whether Singapore was forum conveniens. It was decided this would also resolve the application by the defendant to stay the proceedings based on forum non conveniens.
10.7 In determining the question of whether Singapore was forum conveniens, apart from considering the personal connections of the parties and the location of the witnesses (which the court found were equivocal), the court looked at the question of what law governed the causes of action. While the court found that the substance of the tort was committed in India and therefore governed by Indian law, the other claims (including under the Companies Act) were more appropriately determined by a Singapore court. This tipped the scales for the court and the court concluded that Singapore was forum conveniens.
Forum non conveniens, action in rem, comity, forum shopping, lis alibi pendens, neutralisation of advantages
10.8 When considering an application for stay of proceedings based on forum non conveniens, the court is sometimes faced with the existence of proceedings in other jurisdictions. This matter came up for the court's consideration in The Reecon Wolf[2012] SGHC 22. This was an in rem action involving a collision between the plaintiff's vessel, the Capt Stefanos, with the defendant's vessel, the Reecon Wolf. The defendant commenced proceedings in Malaysia and the plaintiff responded by suing in Singapore by arresting the Reecon Wolf. Applications to stay the proceedings were filed in both jurisdictions. In Singapore, the application was dismissed at first instance and the assistant registrar's decision went on appeal before Belinda Ang Saw Ean J. At the time of the hearing of the appeal, the Malaysian courts had dismissed the stay application before it. Put another way, subject to the outcome of the appeal lodged in that case, the Malaysian courts were going to hear the decision.
10.9 In considering this matter, the court reiterated the two-stage test from Spiliada Maritime Corporation v Cansulex LtdELR[1987] AC 460 (Spiliada) and opined that of all the factors that were submitted, three were foremost in the learned judge's mind. These were the existence of concurrent proceedings, the place of the tort and considerations of comity. On the balance, stage one pointed to Malaysia as the more appropriate forum. The court also concluded that the plaintiff would not suffer any juridical advantages from having the matter heard in Malaysia. As such, the action in Singapore was stayed.
10.10 In the process of making its findings, the court made a number of observations that were noteworthy. First, the court opined that concurrent proceedings were relevant in determining which jurisdiction was the natural forum at stage one of the test in the Spiliada.
10.11 Secondly, and this is related to the first point, considerations of international comity are vital when considering the factor of concurrent proceedings. It is undesirable for different jurisdictions to issue contradictory decisions on the same matter. This was a real concern since the Malaysian courts had already decided that it was going to hear the matter as the natural forum.
10.12 Thirdly, it was important at stage two of the test in the Spiliada to distinguish between legitimate juridical advantages as opposed to practical advantages such as faster trial time or enhanced damages. In this case, the statutory limits in Singapore were higher than in the Malaysian courts and this did not qualify as a legitimate juridical advantage. Doing otherwise would only promote forum shopping.
10.13 Finally, the court opined that an action in rem did not affect the law relating to forum non conveniens or the court's discretion. There is no presumption in favour of the plaintiff and the question remained one of determining the more appropriate forum for the dispute. The court acknowledged that there was one difference in that an action meant that there was security for the claim by way of a maritime lien. This would qualify as a legitimate advantage in stage two of the test in the Spiliada. However, this advantage could be neutralised by the defendant submitting to the jurisdiction of the alternative forum and posting adequate security there. This is consistent with cases finding that time bars in other jurisdictions could be neutralised by the defendant waiving the limitation.
Forum non conveniens, choice of law
10.14 As one of the matters that can be considered at stage one of the test in the Spiliada, the lex causae or law governing the cause is often a significant factor, especially if the governing law is sufficiently different from the law in Singapore. The rationale, of course, is that, the courts of the jurisdiction of the governing law would be most appropriate to interpret and apply that law. In Vorobiev Nikolay v Lush John Frederick Peters[2011] SGHC 55, the plaintiff commenced proceedings for fraudulent/negligent misrepresentation and conspiracy. The defendants applied for a stay on the basis that Switzerland was the more appropriate forum. At first instance the assistant registrar ordered a stay and the plaintiff...
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