Rickshaw Investments Ltd and Another v Nicolai Baron Von Uexkull

• Jurisdiction: Singapore
• Judge: Woo Bih Li J
• Judgment Date: 27 April 2006
• Neutral Citation: [2006] SGHC 70
• Docket Number: Suit No 426 of 2005
• Date: 27 April 2006
• Published date: 03 May 2006
• Year: 2006
• Plaintiff Counsel: Cavinder Bull and Henry Heng (Drew & Napier LLC)
• Citation: [2006] SGHC 70
• Defendant Counsel: Leung Wing Wah and Jonathan Lim (Sim & Wong LLC)
• Court: High Court (Singapore)
• Subject Matter: Forum non conveniens,Plaintiffs commencing action against defendant in Singapore,Natural forum,Whether action commenced in Singapore should be stayed on ground German courts more appropriate forum,Actions in Germany and Singapore overlapping on facts and issues,Action commenced in Germany by defendant against first plaintiff,Conflict of Laws,Whether clause stipulating Germany as jurisdiction to resolve disputes between first plaintiff and defendant amounting to exclusive jurisdiction clause,Whether first plaintiff's German lawyer agreeing to confer exclusive jurisdiction on German courts to resolve all disputes between plaintiffs and defendant,Choice of jurisdiction,Whether plaintiffs deprived of juridical advantages if Singapore action stayed

27 April 2006

Woo Bih Li J:

Background

1 In 1998, the second plaintiff, Seabed Explorations GbR (“Seabed”), discovered the Belitung/Batu Hitam wreck in Indonesian waters. The wreck contained thousands of artefacts from the Tang Dynasty period (“the Tang cargo”).

2 In 2001, Seabed appointed the defendant, Nicolai Baron Von Uexkull (“Nicolai”), to market the Tang cargo. According to Nicolai, it was Tilman Walterfang (“Walterfang”) and Matthias Draeger (“Draeger”), who are both German nationals and equal partners of Seabed, who appointed him. Seabed said it was Walterfang who appointed him. The discrepancy is immaterial for present purposes. There is also some dispute as to the scope of Nicolai’s efforts. Seabed asserted that Nicolai had actively marketed the Tang cargo in Singapore only, whereas Nicolai asserted that he actively marketed the Tang cargo in various countries including Singapore, Brunei, China, Hong Kong SAR, Taiwan, Malaysia, United States of America, United Arab Emirates, Qatar and Kuwait.

3 According to Seabed, Nicolai’s appointment was terminated by a letter dated 28 August 2002 with effect from 31 October 2002. He was re-appointed by a letter dated 27 January 2003 with retrospective effect from 1 December 2002 up to 28 February 2003. However, Nicolai continued to market the Tang cargo after 28 February 2003.

4 Furthermore, Seabed subsequently entered into a written agreement with Nicolai on 30 June 2003 regarding his appointment (“the 30 June 2003 agreement”). There was no specific duration therein for Nicolai’s appointment. The 30 June 2003 agreement set out, inter alia, a basic remuneration of DM8000 (€4,090.24) per month plus expenses for Nicolai and an additional 4% of the sale price of the Tang cargo.

5 The plaintiffs allege that, in or about October 2003, the business of Seabed, including all rights, assets, contracts and agreements previously held by Seabed, was transferred to the first plaintiff, Rickshaw Investments Limited (“Rickshaw”), a company incorporated in the Cayman Islands.

6 By a letter dated 9 June 2004 (“the 2^nd Termination Letter”), on Rickshaw’s letterhead, to Nicolai, Nicolai’s appointment was terminated with immediate effect for breach of duty.

7 On 8 September 2004, Nicolai commenced action in Germany against Rickshaw to claim various reliefs:

(a) payment of his basic remuneration and of expenses and of other moneys outstanding;

(b) a declaration that the termination of 9 June 2004 was invalid; and

(c) information about the sale of the Tang cargo which had apparently been sold by then.

8 The German action is continuing. However, about nine months later, Rickshaw and Seabed commenced action in Singapore on 10 June 2005 against Nicolai in respect of the Tang cargo. Subsequently, Nicolai applied on or about 8 August 2005 to stay the Singapore action. The stay application was heard on 9 December 2005 and was dismissed with costs. Nicolai then filed an appeal on 21 December 2005. On 24 February 2006, I allowed the appeal of Nicolai and stayed the Singapore action. Rickshaw has appealed against my decision. I set out below my reasons and conclusions.

The court’s reasons and conclusions

9 The first ground which Nicolai relied on was that the 30 June 2003 agreement contained a provision which provided for the exclusive jurisdiction of the German courts to hear disputes between the parties. The 30 June 2003 agreement was drafted by Nicolai’s German lawyer in the German language.

10 In his first affidavit of 11 August 2005, Nicolai’s German lawyer, Albrecht Graft Von Reichenbach (“Reichenbach”), said he was fully conversant in English although his mother tongue is German. He referred to the 30 June 2003 agreement and he interpreted the relevant provision to mean:

The parties agree to act under German law for this contract and the exclusive competence of German courts.

11 However, the plaintiffs obtained an English translation of the entire 30 June 2003 agreement from Jorn Gaedcke (“Gaedcke”), a translator with Asian-Link Translation Services. His English translation of the provision in question stated:

The parties agree on German law for this contract and the competence of the German courts.

12 The material difference was the absence of the word “exclusive” from Gaedcke’s translation. In Reinchenbach’s second affidavit of 13 October 2005, he accepted that the word “exclusive” was not in the relevant provision. However he said that he did not give a translation of the words literally but a translation of the meaning. I did not accept that explanation. His first affidavit had purported to give the translation of the relevant provision as he had put the words in inverted commas.

13 Paragraphs 7 and 8 of Reichenbach’s second affidavit then sought to explain why he had said that the relevant provision referred to the “exclusive competence of German courts”. He said:

7. If the court of a case stands in Germany and the case belongs to a German court, it follows that the case does not stand outside Germany and it does not belong to another court but a German court. The meaning of “exclusive” is in my opinion conveyed by the sentence. Therefore, I translated its meaning as “The parties agree to act under German law for this contract and the exclusive competence of German Courts”.

8. In considering the meaning of the sentence, I also considered other factors such as the contract was in German, made between 2 German parties and it was stated in the contract that parties agree on German law for the contract. Secondly, the Defendant herein resides in Bonn, Germany. Seabed Explorations GbR’s representatives Draeger and Walterfang are both German. Draeger resides in St Goar, Germany and Walterfang resides in New Zealand. Finally, the currency for remuneration payable to the Defendant was specified in German Deutschmark and Euros.

14 I found it difficult to appreciate those two paragraphs. Just because a case is filed in or belongs to a German court does not mean that it cannot also be brought in another jurisdiction. Also, the factors which Reinchenbach had raised were relevant in determining the governing law but not the jurisdiction of the German court, let alone whether it has exclusive jurisdiction over the disputes.

15 In the appeal before me, Nicolai’s Singapore counsel, Leung Wing Wah, accepted that the translation obtained by the plaintiffs was accurate. Nevertheless, he argued that the relevant provision still provided for the exclusive jurisdiction of the German courts to hear disputes arising under the 30 June 2003 agreement. In so far as Mr Leung was relying on subsequent conduct to interpret the relevant provision, such an argument was not permissible.

16 I noted that Reichenbach did not assert that the words he used, as he had drafted the 30 June 2003 agreement, was standard or common drafting terminology in German legal practice to confer exclusive jurisdiction. While it is not necessary for an exclusive jurisdiction provision to contain the word “exclusive”, it was clear to me that the relevant provision did not confer such jurisdiction.

17 In any event, if there was any ambiguity, I would have construed the relevant provision against Nicolai under the contra proferentum rule since it was his lawyer who had drafted it.

18 However, Mr Leung also submitted that there was, in any event, a subsequent agreement by the plaintiffs’ German lawyer to submit disputes arising under the 30 June 2003 agreement to the exclusive jurisdiction of the German court. This submission was based on developments arising from the termination of Nicolai’s appointment under the 2^nd Termination Letter. As mentioned earlier, arising from that termination, Nicolai commenced an action in Germany. The defendant in that action is Rickshaw. Upon or prior to the commencement of the German action, Reichenbach had contacted Rickshaw’s German lawyer, Dr Gramlich (“Gramlich”) on 7 September 2004 to ask if he would agree to the action being filed in Frankfurt. Gramlich agreed in a letter dated 7 September 2004. Again, according to Reinchenbach, the relevant sentence in Gramlich’s letter stated:

I accept your offer that the exclusive domicile for the claim is in Frankfurt …

19 However, Gramlich disagreed, saying that the word “exclusive” was not contained in the relevant sentence. According to Gaedcke’s translation, the relevant sentence reads:

I agree to the court of jurisdiction Frankfurt/Main that you suggested …

Again Mr Leung did not dispute Gaedcke’s translation, which did not have the word “exclusive”. More importantly, Gramlich explained that the conversation he had had with Reichenbach on 7 September 2004 was in the context of Nicolai’s claims against Rickshaw only and not in the context of any claim by either Rickshaw or Seabed against Nicolai. Furthermore, the conversation focused on which city in Germany, either Kublenz or Frankfurt, Nicolai’s action should be filed. They had not discussed which country that action should be filed in. Gramlich said that therefore his agreement to Frankfurt was as opposed to other German courts, especially Kublenz. The main substance of Gramlich’s version of the background leading to his letter was not disputed by Reichenbach.

20 In the circumstances, I agreed with counsel for the plaintiffs, Mr Bull, that Gramlich’s letter did not constitute an agreement by both plaintiffs to confer exclusive jurisdiction on the German courts for their claims against Nicolai. It was a limited agreement as to which German city Nicolai’s action should be filed in.

21 However, Reichenbach took yet another point. He said that in the 2^nd Termination Letter, Rickshaw had clearly intended that a German court of law should decide should a dispute arise. I will come back to the relevant part of the 2^nd Termination Letter. Suffice it for me to say here that an intention that a German court of law should decide is quite different from conferring exclusive jurisdiction on a German...