Charoen Pokphand Foods Public Company Ltd v Aqua Star Pty Ltd

1. [1]

   By statement of claim filed in June 2020 the plaintiff Charoen, a public company registered in Thailand, seeks a total sum of $1,015,195.26 it claims Aqua Star owes it for goods it shipped from Thailand to Victoria by a consignee, Sea Boss Australia Pty Ltd, in January, February and March 2018. Sea Boss is not a party to the proceedings.

2. [2]

   The defence pleads that the proceedings have no nexus with this State and that this Court has no jurisdiction. Further, that Aqua Star has an offsetting claim, because the goods delivered were infected.

3. [3]

   By motion filed in August 2020 Aqua Star seeks orders striking out the claim and in the alternative, staying the proceedings permanently, or transferring them to the Supreme Court of Victoria.

4. [4]

   The orders sought were opposed.

Issues

1. [5]

   In issue was whether the Court had jurisdiction in the matter, Aqua Star finally contending that it did not and that without jurisdiction, no orders could be made under the Jurisdiction of Courts (Cross-vesting) Act 1987.

The evidence

1. [6]

   It was common ground that the parties’ contract was part oral, part written and part implied by conduct, including as to the consignee, which was initially a fourth company, before Sea Boss was appointed by Charoen and the disputed goods consigned to it. That was evidenced by a letter signed by both Sea Boss and Aqua Star in January 2018 which was emailed to Charoen, with the result that it delivered the goods sent by each of the three shipments to Sea Boss.

2. [7]

   Aqua Star, which is incorporated in Victoria, relied on affidavits sworn by Mr Wu, a director. He deposed amongst other things that:

3. [8]

   Mr Wu did not indicate who such proceedings would be brought against. But both Charoen and Sea Boss seem to be potential defendants.

4. [9]

   Charoen relied on an affidavit sworn by its solicitor Ms O’Brien, who deposed amongst other things that:

Jurisdiction

1. [10]

   By s23 of the Supreme Court Act 1970 this Court has all the jurisdiction necessary for the administration of justice in this State.

2. [11]

   On the evidence the disputed debt does have a connection with NSW, given that Sea Boss is a NSW company. As was Charoen’s case, given the pleaded defence and the ongoing investigation, it may be that steps will be taken to make Sea Boss a party.

3. [12]

   Rule 12.11 of the Uniform Civil Procedure Rules 2005 empowers the Court to set aside originating process. Here there is, however, no issue about regularity of service in accordance with Rule 10 and Aqua Star having filed a defence, it has thereby submitted to the Court’s jurisdiction.

4. [13]

   It is also long settled that proceedings may be stayed if it would inflict an injustice to put a party to the expense of defending an action here. On the one hand, the Court must see clearly that in stopping an action it does not do injustice and on the other, that it ought to interfere whenever a defendant is subjected to vexation and oppression in defending an action which ought not to have been sued in the Court in which the action is brought, when injustice would not result, if the action were brought in another accessible and competent court: Maritime Insurance Co Ltd v Geelong Harbor Trust Commissioners 6 CLR 194; [1908] HCA 37; (1908).

5. [14]

   It is thus relevant that what is at issue is a common law debt claim. There is but one common law in Australia: James Hardie & Coy Pty Ltd v Barry & Anor; Seltsam Pty Ltd v Barry & Anor [2000] NSWCA 353 at [95].

6. [15]

   It is difficult to see that today, such proceedings being able to be conducted as easily by electronic filing and virtual hearing in this Court, as they could in the Victorian Supreme Court, that if the proceedings are heard by this Court, that Aqua Star will be put to either vexation or oppression.

7. [16]

   The Court will also be slow to interfere when the parties have agreed that proceedings about contractual disputes would be brought in a particular jurisdiction: Australian Health & Nutrition Association Ltd v Hive Marketing Group Pty Ltd [2019] NSWCA 61. But there was no such an agreement made here.

8. [17]

   The defence case pressed was that the Court has no jurisdiction in the matter at all, the proceedings concerning as they do a contract formed and broken either in Thailand or Victoria; having been performed internationally; with goods delivered to Victoria; and with neither party being resident, trading or having any connection with this State. The only connection with the State appeared to be the location of the plaintiff’s solicitor, which was insufficient to give the Court the necessary jurisdiction.

9. [18]

   Thus while the Court had “subject matter jurisdiction”, that is to hear claims in relation to a contractual dispute such as this, it had no “personal jurisdiction”, to hear this matter.

10. [19]

    Reliance was placed on National Commercial Bank v Wimborne (1979) 11 NSWLR 156 where it was concluded at 165 that the Court had no jurisdiction to entertain a cross claim brought against a Saudi Arabian Prince who had no assets, place of business, office, resident representative or agent in this State. Nor did it have jurisdiction in relation to a claim against a foreign company which had no ‘presence’ for legal purposes in this State, given that it did not carry on business here: at 165.

11. [20]

    The circumstances which here arise for consideration are far removed from those considered in Wimborne, given where Aqua Star is located and the current state of the law.

12. [21]

    In Agar v Hyde (2000) 201 CLR 552; [2000] HCA 41; consideration was given to Pt 10 of the then Supreme Court Rules, which permitted service outside Australia in only limited circumstances. There is no such limitation in Rule 10.3 of the Uniform Civil Procedure Rules, which like the Service and Execution of Process Act 1992 (Cth), permits service of originating process anywhere in Australia.

13. [22]

    As observed in Agar at [56] “If service was authorised by the Rules, and has been properly effected, the Court's authority to determine the issues that are raised by the proceeding has been regularly invoked.”

14. [23]

    It is apparent that they have been regularly invoked. As White J observed in Jardine Lloyd Thompson Pty Ltd v Puri [2016] NSWSC 150 at [14]:

15. [24]

    That accords with what was decided in Bankinvest AG v Seabrook (1988) 14 NSWLR 711 at 713-714 and BHP Billiton Ltd v Schultz (2004) 221 CLR 400; [2004] HCA 61 at [14], to which I will return

16. [25]

    The statement of claim contained a notice that it would be served to Aqua Star in Australia, but outside New South Wales under the Service and Execution of Process Act.

17. [26]

    The challenge to jurisdiction must thus fail.

Cross vesting order

1. [27]

   In resolving what lies in issue regard must be paid to the overriding purpose specified in s56 of the Civil Procedure Act 2005, facilitating the just, quick and cheap resolution of the real issues in the proceedings. The Court must also act in accordance with the dictates of justice, taking into account the matters specified in s58(2), which include the degree of injustice that would be suffered by the respective parties, as a consequence of any order or direction.

2. [28]

   Aqua Star still maintained that no order transferring the proceedings to the Victorian Supreme Court could be made, given that this Court had no jurisdiction to entertain the proceedings.

3. [29]

   Charoen’s case was that the Preamble to the Act demonstrated that it had been enacted in order to preclude that outcome. That must be accepted, given what the Act provides and the relevant authorities have held. The preamble provides:

4. [30]

   The Court can transfer proceedings to the Supreme Court of Victoria, when there are related proceedings pending in that Court: s5(2) Jurisdiction of Courts (Cross-vesting) Act 1987. But Aqua Star has not commenced any proceedings.

5. [31]

   Transfer must be ordered if the Court is satisfied that having regard to the interests of justice, it is more appropriate that the proceeding be determined by the Supreme Court of Victoria, or that it is otherwise in the interests of justice that the proceeding be determined by that Court: s5(2)(ii) and (iii).

6. [32]

   In Bankinvest AG at 713-714, Street CJ observed:

7. [33]

   In BHP Billiton it was observed that:

8. [34]

   In this case, I am not satisfied that Aqua Star has met the onus which falls on it to satisfy the Court that a transfer order must be made. As Ward CJ in Eq discussed in Ant & Ballast Pty Ltd v City of Greater Geelong [2019] NSWSC 188 at [25]:

9. [35]

   What is in issue is a disputed debt which must be resolved by application of the common law. There is but one common law in Australia.

10. [36]

    This factor thus does not support the conclusion that transfer should be ordered.

11. [37]

    The proceedings are likely to be heard virtually, whichever Court hears them. No procedural disadvantage or additional cost is likely to flow to witnesses if the matter is heard in this Court and Aqua Star did not suggest that it will incur additional costs, if the order is not made.

12. [38]

    There is unchallenged evidence from Ms O’Brien that Charoen, a foreign company, will incur additional costs because she has advised it that if the matter is transferred, Victorian counsel and solicitors should be instructed, although it should be accepted that is likely to be a Baker and McKenzie partner or employed solicitor who is then engaged.

13. [39]

    This factor slightly favours the matter remaining in this Court.

14. [40]

    As a Thai company with no operational presence in Australia, Charoen undoubtedly had to rely Ms O’Brien’s advice that the proceedings should be commenced in this Court. It was that given the claim in debt which it pursues, that the underlying dispute had connections with Thailand, Victoria and NSW and that there was no choice of law clause, proceedings should be commenced in this Court.

15. [41]

    Much of the background circumstances are not in dispute. Aqua Star has provided Charoen with a draft counter claim, which I accept raises the possibility that Sea Boss will be joined as a party.

16. [42]

    Aqua Star is a wholesale distributor of seafood and the product consigned to Sea Boss, the holder of the necessary import license, was frozen prawns which Aqua Star claims were infected with white spot virus. Ms O’Brien is thus pursuing investigations into Sea Boss, the conditions of its license and its involvement in the condition of the prawns.

17. [43]

    I accept that this factor favours the proceedings remaining in this Court.

18. [44]

    If proceedings were on foot in the Victorian Supreme Court, that would be a relevant consideration, but such proceedings seem to be unnecessary, given the defence already filed.

19. [45]

    The only investigation currently being pursued is in relation to Sea Boss. That also favours the proceedings remaining in this Court.

20. [46]

    There was no issue that both this Court and the Supreme Court of Victoria could hear this case virtually. That does not favour one court over the other.

21. [47]

    The location of the parties and their witnesses is likely to be in Thailand, Victoria and NSW and their legal representatives in Victoria and NSW. Balance of convenience is thus neutral, that not favouring the proceedings being heard in one court, rather than the other.

22. [48]

    In the result I am satisfied that the proceedings should not be transferred to the Victorian Supreme Court, Aqua Star not having established that it is interests of justice that the proceeding be determined by the Supreme Court of Victoria.

Costs

1. [49]

   The usual order as to costs under the Rules being that costs follow the event, that is an order that Aqua Star pay the costs of the motion, as agreed or assessed.

Orders

1. [50]

   For these reasons I order that the motion be dismissed and that unless the parties approach to be heard on costs within 7 days, that Aqua Star pay the costs of the motion, as agreed or assessed.