Westacre Investments Inc. v The State-Owned Company Yugoimport SDPR

JurisdictionSingapore
Judgment Date30 December 2008
Date30 December 2008
Docket NumberCivil Appeal No 141 of 2006
CourtCourt of Appeal (Singapore)
Westacre Investments Inc
Plaintiff
and
The State-Owned Company Yugoimport SDPR (also known as Jugoimport-SDPR)
Defendant

Chan Sek Keong CJ

,

Andrew Phang Boon Leong JA

and

V K Rajah JA

Civil Appeal No 141 of 2006

Court of Appeal

Civil Procedure–Foreign judgments–Enforcement–Registration–Whether Commonwealth judgment that was no longer fully enforceable in country of origin might be registered in Singapore–Whether just and convenient for court to enforce Commonwealth judgment in Singapore–Applicable principles–Whether delay in enforcing judgment justified–Sections 3 (1), 3 (3) (a), 3 (3) (b) Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed)–Words and Phrases–“In so far only as relates to execution”–Section 3 (3) (b) Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed)–Words and Phrases–“Just and convenient”–Section 3 (1) Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed)

Sometime prior to 1990, Westacre Investments Inc (“the Appellant”) entered into a consultancy agreement with Yugoimport SDPR (“the Respondent”). Pursuant to that agreement, Beogradska Banka DD (“Beogradska”) guaranteed the payment of all fees due from the Respondent to the Appellant. The Respondent subsequently repudiated the agreement and the Appellant then commenced arbitration proceedings.

In 1994, an ICC arbitral tribunal made an award in the Appellant's favour. The award determined that the Respondent and Beogradska were jointly and severally liable to pay the appellant the sum of approximately US$50m and 1 plus interest. A year later, the Appellant commenced proceedings in England to enforce the arbitration award there. In December 1997, the English High Court ruled in favour of the Appellant and judgment was entered against the Respondent for approximately 42m (“the English Judgment”). The Respondent's appeal to the English Court of Appeal was dismissed in May 1999 and the House of Lords subsequently refused to grant leave to appeal. Over the next few years, the Appellant vigorously pursued a number of legal remedies in England in a bid to enforce the English Judgment, but to no avail.

Sometime in late July 2004, the Appellant ascertained that there was a bank account in Singapore which contained funds of about US$14.8m allegedly belonging to the Respondent but held in the name of Deuteron (Asia) Pte Ltd, a company in which the Respondent appeared to hold 49% of the paid-up capital. On 5 October 2004, the Appellant applied ex parte pursuant to the Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed) (“RECJA”) to register the English Judgment in Singapore. The application was allowed. On 2 June 2005, the Respondent applied to the High Court to set aside the registration. The setting-aside application was heard by an assistant registrar, who dismissed it with costs. The Respondent then appealed.

The judge who heard the appeal disagreed with the assistant registrar and determined that it was not just and convenient that the English Judgment be registered as the Appellant had not discharged the burden of justifying its delay in applying to register the English Judgment. Further, it was held that the Respondent would be prejudiced by the delayed registration. Dissatisfied with the judge's decision, the Appellant appealed to the Court of Appeal. At the same time, the Respondent cross-appealed against the judge's determination on the limitation issue, which was decided in the Appellant's favour.

Held, allowing the appeal:

(1) The Respondent's argument that the English Judgment constituted in substance an implied contract and was time-barred by the Limitation Act (Cap 163, 1996 Rev Ed) was a misconceived one, as it unhappily conflated a distinct statutory right conferred by Parliament with a common law action for a debt. Such an argument also stood in direct conflict with s 3 (1) of the RECJA, which provides that an application to register a Commonwealth judgment in Singapore could be made at any time within 12 months after the date of the judgment, or such longer period as may be allowed by the Court: at [4] and [5].

(2) Enforceability of a Commonwealth judgment in the jurisdiction in which it was obtained was a prerequisite for registering that judgment in Singapore. Since the English Judgment was enforceable in some manner in England, it followed that the judgment fulfilled the threshold requirement of registrability under the RECJA: at [9] and [52].

(3) Under the framework of the RECJA, the court had to consider all the circumstances of the case and should permit registration of a Commonwealth judgment only if it was just and convenient that the judgment should be enforced in Singapore: at [21].

(4) In determining whether to allow a RECJA application, the factors which the court should take into account, inter alia,were: (a) whether the delay had caused prejudice to the judgment debtor; (b) whether the judgment creditor could give a reasonable explanation for its delay in applying to register the Commonwealth judgment; (c) whether the judgment creditor had been reasonably diligent in seeking to enforce the Commonwealth judgment; and (d) whether the judgment debtor had been obstructive. In essence, the question which the court had to determine was: Where did the interests of justice lie, having regard to the factual matrix of the case?: at [24].

(5) The evidence showed that the Appellant was persistent and diligent in its attempts to seek recovery of the judgment debt, whereas the Respondent had sought to obstruct the enforcement efforts by painting a selective and incomplete picture of its assets. As such, in the circumstances of the case, it was just and convenient that the English Judgment be enforced in Singapore: at [47], [53] and [55].

Cheah Theam Swee, Re; ex parte Equiticorp Finance Group Ltd [1996] 1 SLR (R) 24; [1996] 2 SLR 76 (refd)

Dianne Margaret Quinn v Pres-T-Con Ltd [1986] 1 WLR 1216 (refd)

Duer v Frazer [2001] 1 WLR 919 (refd)

Ladd v Marshall [1954] 1 WLR 1489 (refd)

Lee Hsien Loong v Singapore Democratic Party [2008] 1 SLR (R) 757; [2008] 1 SLR 757 (refd)

Lian Soon Construction Pte Ltd v Guan Qian Realty Pte Ltd [1999] 1 SLR (R) 1053; [1999] 2 SLR 233 (refd)

Society of Lloyd's v Longtin [2005] 2 CLC 774 (refd)

Thamboo Ratnam v Thamboo Cumarasamy and Cumarasamy Ariamany d/o Kumarasa [1965] 1 WLR 8 (refd)

Westacre Investments Inc v The State-Owned Company Yugoimport SDPR [2008] EWHC 801 (Comm) (refd)

Yong Tet Miaw v MBF Finance Bhd [1992] 2 SLR (R) 549; [1992] 2 SLR 761 (refd)

Limitation Act (Cap 163,1996Rev Ed)s 6 (1)

Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed)ss 3 (1), 3 (3) (b) (consd);s3 (3) (a)

Reciprocal Enforcement of Foreign Judgments Act (Cap 265, 2001Rev Ed)ss 2 (1), 4 (1),4 (1) (a)

Rules of Court (Cap 322, R5, 2006Rev Ed)O 3rr 4, 4 (1), O 67r 3 (1) (c) (i),O 92 rr 4, 5

Arbitration Act 1950 (c 27) (UK)s 26

Arbitration Act 1975 (c 3) (UK)s 3

Civil Procedure Rules (UK) Pt 72

Limitation Act 1980 (c 58) (UK)s 24 (1)

Rules of the Supreme Court 1965 (SI 1965 No 1776) (UK)O 46rr 2, 2 (1) (a)

Khoo Boo Jin, Tan Hsuan Boon and Peter Chia (Wee Swee Teow & Co) for the appellant

Lok Vi Ming SC, Kirindeep Singh and Govindarajalu Asokan (Rodyk & Davidson LLP) and Gabriel Peter, Kelvin David Tan and Calista Peter (Gabriel Law Corporation) for the respondent.

Judgment reserved.

V K Rajah JA

(delivering the judgment of the court):

Introduction

1 The present appeal has a long and convoluted history. Sometime prior to 1990, Westacre Investments Inc (“the Appellant”) entered into a consultancy agreement with Yugoimport SDPR (“the Respondent”), a state-owned company in what is now the Republic of Serbia (“Serbia”), with respect to the sale of certain equipment in Kuwait. Pursuant to the agreement, Beogradska Banka DD (“Beogradska”) guaranteed the payment of all fees due to the Appellant. The agreement was governed by Swiss law and expressly provided that all disputes were to be settled in accordance with the Rules of Arbitration of the International Chamber of Commerce (“ICC”). The Respondent subsequently repudiated the agreement and, as a result, the Appellant commenced arbitration proceedings against the Respondent and Beogradska. An ICC arbitral tribunal made an award dated 28 February 1994 in the Appellant's favour (“the Award”). The Award determined that the Respondent and Beogradska were jointly and severally liable to pay the Appellant the sum of US$50,010,093.36 and 1,029,629.37 plus interest accruing at 5% per annum. After the Award was issued, the Respondent and Beogradska appealed to the Swiss Federal Tribunal to review the Award on public law grounds. The appeal failed.

2 In August 1995, the Appellant commenced proceedings in England under s 26 of the Arbitration Act 1950 (c 27) (UK) and s 3 of the Arbitration Act 1975 (c 3) (UK) for leave to enforce the Award. A common law action on the Award itself (as distinct from the proceedings for leave to enforce the Award) was also commenced in April 1996 (both actions were eventually consolidated). In December 1997, the English High Court ruled in favour of the Appellant. Judgment was entered in favour of the Appellant against the Respondent and Beogradska in the sum of 41,584,488.86 on 13 March 1998 (“the English Judgment”). At the same time, execution of the English Judgment was stayed pending an appeal by the Respondent and Beogradska to the English Court of Appeal. On 12 May 1999, that appeal was dismissed. The Respondent and Beogradska then petitioned the House of Lords for leave to appeal. On 20 October 1999, the House of Lords refused to grant leave to appeal, and, on 10 November 1999, an order was made by the English Court of Appeal lifting the stay of execution. Over the next few years, the Appellant vigorously pursued a number...

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