Conflict of Laws

• Citation: (2014) 15 SAL Ann Rev 202
• Published date: 01 December 2014
• Date: 01 December 2014

Introduction

11.1 For 2014, There Are Seven Cases That Will Be Examined In This Review.

11.2 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.

11.3 Further, four cases in 2014, Broadcast Solutions Pte Ltd v Zoom Communications Ltd[2014] 1 SLR 1324, EFT Holdings, Inc v Marinteknik Shipbuilders (S) Pte Ltd[2014] 1 SLR 860, Malaysia Marine ABD Heavy Engineering Sdn Bhd v VLK Traders Singapore Pte Ltd[2014] 1 SLR 998 and The Republic of the Philippines v Maler Foundation[2014] 1 SLR 1389 have already been considered in last year's Ann Rev.

Discretionary jurisdictionWhether concurrent application for stay amounts to submission and burden of proof in application of stay based on forum non conveniens

11.4 When faced with a foreign defendant, a claimant can invoke the long-arm jurisdiction of the Singapore courts via O 11 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed). That foreign defendant can then apply to dispute the jurisdiction of the courts as well as to apply to the court to stay the proceedings based on, inter alia, forum non conveniens. Zoom Communications Ltd v Broadcast Solutions Pte Ltd[2014] 4 SLR 500 (Zoom Communications) illustrates the challenges when a foreign defendant applies to do both.

11.5 The facts can be stated simply. The respondent, Broadcast Solutions Pte Ltd (Broadcast Solutions) (a company incorporated in Singapore), sought sums of money from the appellant, Zoom Communications Ltd (Zoom Communications) (a company incorporated in India) under three hire-purchase agreements. The respondent obtained leave to serve the appellant outside the jurisdiction. The appellant filed an application to set aside service and, in the alternative, an application to stay the proceedings. At first instance, the assistant registrar dismissed these applications.

11.6 On appeal to the High Court, Woo Bih Li J held that by applying in the alternative to stay the proceedings, this was sufficient to evince an intention to submit to the jurisdiction of the Singapore courts. Further, on a consideration of the stay application, Woo J concluded that the appellant had not shown that there was a clearly or more distinctly appropriate forum elsewhere and denied the application for a stay.

11.7 On appeal, the Court of Appeal was faced with two issues. The first was whether the appellant had submitted to the jurisdiction of the Singapore courts by seeking a stay and making arguments to this end as an alternative to setting aside jurisdiction. The second issue related to the application of the test from Spiliada Maritime Corp v Cansulex Ltd[1987] AC 460 (Spiliada) within the factual matrix of this case.

11.8 On the first issue, the Court of Appeal made some clarifications to this area which can be summarised in four propositions:

(a) An application to stay proceedings simpliciter generally means that the defendant has submitted to the jurisdiction of the courts: Zoom Communications at [56].

(b) An application to stay proceedings as an alternative to a jurisdictional challenge will generally not be taken to be a submission to the jurisdiction of the Singapore courts: Zoom Communications at [56].

(c) An application to stay proceedings may not amount to a submission to the jurisdiction of the Singapore courts if the stay is sought because the question of jurisdiction can only be determined after the outcome of ongoing foreign proceedings is known. This, however, only applies if the Singapore courts have the power to stay the proceedings in Singapore without first assuming jurisdiction over the foreign defendant. The court opined that it was unclear whether this power was conferred either by para 9 of the First Sched of the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) or the High Court's inherent jurisdiction. As such, the Court of Appeal did not express a conclusion on this point: Zoom Communications at [56].

(d) The court acknowledged that due to the time lines laid down by the Rules of Court, it seemed to be good practice to apply for a stay of proceedings at the same time as a challenge to jurisdiction. However, the court opined that this may not be good practice and that it might not be necessary to separately jurisdiction. This was because the question of whether Singapore is the natural forum for the dispute was already necessarily embedded within the challenge to the existence of the Singapore courts' jurisdiction: Zoom Communications at [56] and [76].

11.9 These are welcome clarifications indeed. It had seemed odd, at least to this author's mind, that where a defendant had argued a stay as an alternative to a challenge to jurisdiction, this was taken to be submission. There should be clear evidence of intention to submit and considering the onerousness of the long-arm jurisdiction of the court via O 11 of the Rules of Court, it is right to require a fairly high threshold before one should conclude that submission has occurred. The author agrees with the robust approach the court has taken to this question.

11.10 Applying these propositions, the Court of Appeal opined that the application of the stay or in submitting arguments relating to the stay did not, in this case, constitute submission to the court by the appellant.

11.11 On the application to set aside the leave order, the appellant argued that there was both a failure on the part of the respondent to provide full and frank disclosure of material facts as well as to show that Singapore was the natural forum for the dispute.

11.12 On the issue of non-disclosure, the court found that while there was non-disclosure of material facts, it was not prepared to set aside the leave order because those facts were not so material taking into account the circumstances of the case: Zoom Communications at [69].

11.13 On the issue of natural forum, the Court of Appeal made a number of helpful observations. First, where a foreign defendant is sued in Singapore via O 11, the Spiliada test applies at two points: one where the plaintiff applies for leave to serve outside of the jurisdiction; and the other where the defendant seeks to, after service, stay proceedings based on forum non conveniens: Zoom Communications at [70].

11.14 Second, at either point, the substance of the Spiliada test remains the same, that is, the inquiry is to establish the jurisdiction for which is the natural forum for the dispute via the application of a twostage test: Zoom Communications at [77].

11.15 Finally, the difference between the two points is on which party the burden of proof lies with. In the application for service out of jurisdiction, the burden falls upon the plaintiff to show that Singapore is the natural forum. Where jurisdiction has been established, the burden falls upon the defendant to show that there is a clearly more appropriate forum elsewhere: Zoom Communications at [71][72].

11.16 Applying the Spiliada test to the facts, the court reiterated the principle that an appeal court should not lightly interfere with a decision of a lower court on a balancing of these factors unless there was an error of law or a misapplication of the relevant principles: Zoom Communications at [81]. It will be recalled that Woo J had found that the defendant had failed to show that India was a more appropriate forum.

11.17 The court went on to agree with Woo J's analysis that the connecting factors were evenly balanced but also found that Woo J had not considered as a factor that the breaches of contract occurred in Singapore. The court felt that this tipped the balance squarely towards Singapore as the proper forum for the dispute.

11.18 While this finding led to essentially the same outcome as Woo J's finding, it is important because, in the Court of Appeal's analysis, the burden of proof was on the respondent to show that Singapore was the natural...