Private International Law exam summary notes, detailed structure and case summary, Study notes of Private international law

Download Private International Law exam summary notes, detailed structure and case summary and more Study notes Private international law in PDF only on Docsity! 1 LECTURE 1: SUBJECT ● Private international law = conflicts between individuals from different countries which does not concern states ● English common law is normally applied in international contract disputes → number 1 in the world ○ Even if the country has no connection with UK law ● Country meaning: any territorial unit having their own legal system even if they are not independent nation ○ US states are countries (different states have different legal systems) ○ UK: Scotland is a separate country from UK as it has its own legal system but Wales is not ○ HK: country different from China ● Common Law VS European rules ○ Rule of conflict of laws differ from country to country ○ Particularly significant differences between common law countries and civil law countries ○ Common law: more flexible rules, emphasis on judge discretion, fairness ○ Civil law: more rule based and more certain ● International governing bodies -- Slow progress of these conventions though ○ Hague Conference on PIL ■ To ensure countries agree on the same rules of PIL when dispute arises ■ Clear rules for law enforcement and jurisdiction of courts ■ Problems of HCCH: the convention has no effect until the country rectify it → slow process, little impacts ● China: refuse to ractify the conventions as it deems the rectification an intrusion of its sovereignty ○ UNCITRAL ○ UNIDROIT ■ Conventions involving mobile phone agreements… Questions to be answered by COL rules (1) Should HK courts have the jurisdiction over the ● E.g. should HK hear the case that has no connection to domestic law 2 matter? (place) ● Is HK the appropriate forum? ● Involves the extend to allow forum shopping ○ Forum shopping = to stop a person bringing the claim in the jurisdiction that will give them the best result ● Forum conveniens → factor to decide whether HK court has the jurisdiction (2) Should HK law apply? (law) ● Many areas of law if jurisdiction of HK court applies, the domestic law will apply ○ Family, contract.. ● Other cases e.g. PRC contract law (3) Should a court in one country recognise and enforce a court judgement obtained in another country? (Enforcement of judgements) / Reasons for these rules: ● Encourage commercial activities ○ Clear rules to which law to apply ● Minimise forum shopping ● Avoid parallel proceedings ● Achieve justice ● Principle of res judicata (the principle that a cause of action may not be relitigated once it has been judged on the merits) ○ Rules on finality ● Principle of Comity = Respect for other legal systems in the world ○ HK court is slow to conclude that a party would not get a fair trial if proceedings were allowed to commence in a foreign court and that interference in foreign proceedings ○ E.g. by use of anti-suit injunctions to stop the foreign proceedings, should be kept to a minimum. ○ Judicial sovereignty has been replaced by judicial comity -- Diplock 5 Or Lex loci solutionis: law of the place of intended performance No Lex fori: HK Lex causae: Mainland Applicable law 1 Substantive Substantive Lex causae: Mainland ● Apply foreign law if substantive 2 Procedural Procedural Lex fori: HK ● Apply domestic law if procedural 3 Substantive Procedural No law applies. HK courts do not apply foreign procedural law and as Lex causae is Mainland law, HK substantive law is not applicable! 4 Procedural Substantive Both apply. HK will apply its own procedural rules but also apply all substantive rules of lex causae → Mainland ★ Situation: when there are >1 COL issues: the need to categorise main issue and subsidiary issue ○ Court will apply the same foreign law to the subsidiary issue that they applied to main issue -- Re Johnson (b) Renvoi ● French word: “to send back” ● If local court decides to apply renvoi, it will decide the case in the way the foreign judge decides ○ Adopts the rules of a foreign jurisdiction with respect to any conflict of laws that arises ● Ask: whether a court should apply the total or partial foreign law? 6 ○ Total renvoi: court both domestic and the conflict of law rules ○ Partial renvoi: only the domestic law ● Problem created by “total” renvoi: all foreign law including its COL rules i. Danger of creating a loop where no certain rules apply ii. Unclear rules and unnecessary expenses iii. Jurisdiction losing their house power to decide on cases ● Note: so far in HK, renvoi has not been applied Where renvoi is excluded… Most commonly used… ● Commercial contracts → for the purpose of certainty ● PRC jurisdiction ● Validity of will ● Marriage Renvoi is rejected Renvoi is accepted ● Partial renvoi ● The court applies the substantive rules of the foreign law but ignores any conflict of laws rules that would refer the matter back to its own jurisdiction ● Total renvoi ● The court applies the rules of the foreign law as if it were the law of its own jurisdiction, including the application of foreign COL rules Renvoi accepted -- apply both domestic and COL rules Neilson v Overseas Projects of Victoria ● P1 (Australian) living in China was injured in a fall in an apartment provided by D (Australian company) ● The apartment was provided to her under arrangements made in Australia. ● More than five years after the accident, she sued D for negligence in Australia. ● D contended that the claim was statute-barred in the General Principle of Civil Law in China: limitation period is 1 year ● Art 146 of GPCL however allows the application of Australian law 7 ○ “If both parties are nationals of the same country or domiciled in the same country, the law of their own country or of their place of domicile may also be applied” Held: ● Trial judge: ○ Art 146 should apply and P was not time barred according to Australian limitation periods and principles of negligence ● Reverse decision by The Full Court: ○ Chinese law should apply, excluding Art 146 ○ P was time barred On appeal to High Court: ● 6:1 held that in the case of foreign torts, the governing law is the law of the place of the tort = China ● Chinese law should apply including its COL rules Justification: ● Achieve uniformity ● Discourage forum shopping ● Ensure that the outcome is the same whether the case had been heard in the foreign jurisdiction or in the home country Re Ross** ● UK lady lived in Italy for 30 years and domicile there but still retains UK nationality ● Made a will which excluded her son ● Under UK law, one can leave his money to anyone ● However Italian law, emphasises family values, wife and children are entitled by law mandatorily 50% of the estates ● Case heard in UK, under English law is the law of domicile (Italy) → she has to leave 50% of her share to her son Conflict of laws: material validity of UK lady’s will -- was the son entitled to the estate of his mother ● English judge: apply English COL rules 10 ● Meaning that are there any differences between the two systems will lead to a substantively different outcome Similarity rule is subject to the following exceptions 1) It is not in the interests of justice to apply it 2) The foreign law is not based on the common law 3) It is inherently improbable that the foreign law is the same 4) The domestic law must be potentially universal 5) Cannot be used by D to circumvent a burden of proof already imposed on him Dafni Igal v CMA CGM SA [2012] HKCFI 2082 ● HK court refused to assume Taiwanese tax laws were the same as HK ● Reasons: ○ “(i) the jurisprudential difference of the two jurisdictions and ○ (ii) the highly specific nature of taxation law. ○ “(iii) tax statutes are not the type of laws that one could rationally assume to have any significant degree of universality” [No] Caspian Resources Development Pte Ltd v Fortune Oil Plc [2015] HKEC 2124 ● Court rejects the application of HK law ● The relevant ordinance in HK is intended to apply to companies incorporated in HK or registered in HK ● Where P is not incorporated in HK and has no place of business in HK ● Par 37 judgement: “I consider that Part 15 to be some merely domestic rule of Hong Kong law and not a generally applicable rule of company law” ● Remarks: in UK practice, where foreign law is not plead or proved and court applies English law ○ Likely to be challenged if the rule of English law is statutory rather than a rule of common law (universal) ● Dicey states that: 11 ○ "In principle, an English statute may not be applied to a matter governed by a foreign law, in circumstances where that foreign law has not been proved, if the English statutory rule appears to state a rule of purely domestic law, or where the wording of the statute would need to be adapted or changed in order to be made applicable to facts which do not otherwise fall within it." [No] Tremendous Success Holdings Ltd v Sinosoft Technology Group [2016] HKEC 1509 Cannot circumvent burden of proof of D ● D wants to rely on HK law instead of Nanjing law ● He has the burden of proof to show Nanjing law is the same as HK ● The presumption rule could not be used to displace the rule: ○ In a forum non conveniens (allowing HK court decline its jurisdiction over the case) dispute where HK has jurisdiction as of right the burden is on the defendant to prove the foreign court is the more appropriate jurisdiction to hear the case HK provisions on evidence of foreign law -- to minimise costs and time S.59 Evidence Ordinance Evidence of foreign law ● Decisions from High Courts of Hong Kong or England (or on appeal from those Courts) on foreign law is admissible as evidence in a later case as establishing the relevant foreign law ● Unless the contrary is proved. 12 WEEK 2: DOMICILE ● Significance of domicile: decides choice of law in areas of personal law such as marriage, status, succession and taxation HK: Domicile Ordinance 2008 ○ Lex fori applies its own rules on domicile to determine where a person is domiciled. ○ Technical term for person whose domicile is at issue is the propositus ○ Ordinance significantly changes the law on domicile in Hong Kong. ○ To understand the Ordinance you need to know the old law first. ○ NB also old law still relevant if the issue of domicile before March 2009 needs to be decided -- s.13 General rule ● Everyone has a domicile -- s.3(1) ● Can only have one domicile at a time -- s.3(2) ● Lex fori -- domicile Old law -- (1) Domicile of Origin (still exists in UK with minor changes) SEXIST!! ABANDONED ● Acquired at birth which is determined by parents ● If parents are married at the time the child is born, DO of child is the father’s not mother’s ○ Same sex marriage: still follows the father’s -- the father who provided sperm ● Very artificial as it focuses on father’s/mother’s domicile at time of child’s birth which may have little connection to the country where the child will live. ● Areas of uncertainty ○ Child born after father’s death or post divorce ○ Adopted children ● Courts were very reluctant to conclude DO was lost → reflection of British Imperialism ○ High BOP needed Ramsay v Liverpool ● Ramsay from Scotland 15 [NO] Re Jone’s Estate ● DO is England ● DC is Iowa, get married there and intends to stay there for his life ● Wife died and decided to return to England ● Got on boat but the boat sank before reaching England ● Held: domicile is Iowa ○ Did not get back to England ○ Retain domicile of adults in Iowa HONG KONG CASES ON THE OLD LAW [HK dom] Re Ip Pui Man Nina [2007] ● Has A remained domiciled in HK or acquired SG domicile? ● A left HK after her breakup ○ Describes HK as “traumatising and agonising place” ○ “Much happier in SG” ○ “Stay in SG for some time” Held: remains to have HK domicile ● Stayed at SG just to get over breakup, has not abandoned HK domicile [NO] Re State of Gao Yuan [2011] ● He came to HK for work and stayed in accommodation provided by company ● Goes back to Guangzhou during holiday ● After A died, widow tried to argue that their family planned to stay in HK after son graduated in HK Held: A did not acquire HK domicile ● Insufficient evidence ● And failed the physical test Change of Domicile of Choice ● Presumption against a change must be proved on a balance of probabilities ○ Lower hurdle comparing to change of DO Requirements: BOTH MUST COINCIDE i. Must physically leave the place you are currently in ii. Intention to abandon the current domicile 16 [NO] Sekhri v Kay ● Lady lived in UK and wanted to change her domicile to SG due to divorce matter Held: remains to have UK domicile ● “In SG at a moment… get a breather in SG” ● Did not show intention to abandon domicile in UK KELLY v PYRES [2018]EWCA Civ 1368 ● Highlights that both physical presence and intention must coincide Old law -- (4) Domicile of Origin REVIVAL Before 2009 March, HK still have Now CL stil exists -- legal dispute time being before 2009 ● If domicile of choice is abandoned and not replaced with a new one → DO revives ● Revival often produces bizarre consequences resulting in a person having a domicile in a country they have never visited ! [NO] UDNY v UDNY ● Issue: Whether Udny was still domiciled in Scotland at the time his matrimonial affairs being determined ● Udny born in Scotland and bought a house in Scotland ● Lived in UK for 30 years, at this point changed his domicile to England by selling off the house and furniture for France ● Left Scotland for years and had no intention to go back Held: domicile is Scotland ● His domicile of origin was revived because by selling his house and its furniture, his intention was to terminate his domicile of choice CHANGES IN LAW AFTER DOMICILE ORDINANCE 2008 Abandoned laws Changes ● Domicile of Origin ● Revival rule ● Domicile of Choice: Test for permanent intention to reside 17 ● Domicile of Dependency ● Apply the Domicile Ordinance (new law) if the issue of domicile is raised from 1st March 2009 onwards ● No mix-matching of old and new laws ○ Work out the actual date of the dispute of finding someone’s domicile 1. Domicile of children -- s.4 s.4 Domicile of children (1) A child is domiciled in the country or territory with which he is for the time being most closely connected (2) Where the child’s parents are domiciled in the same country or territory and the child has his home with either or both of them, it shall be presumed, unless the contrary is proved, that the child is most closely connected with that country or territory (3) Where the child’s parents are not domiciled in the same country or territory and the child has his home with one of them, but not with the other, it shall be presumed, unless the contrary is proved, that the child is most closely connected with the country or territory in which the parent with whom he has his home is domiciled s.11(2) Child’s preference In determining for the purposes of section 4 the country or territory with which a child is for the time being most closely connected, account shall be taken of any preference that the child may have as to the country or territory in which to have his home. ● Identify the country the child is most closely connected to ○ Where is the child’s home? ● Court will take into consideration of child’s preferences if he is mature enough to have one s.11(2) ● Parents same domicile resumption: The child is most closely connected to that country, same domicile as parents -- s.4(2) ● Parents different domicile presumption: The child is most closely connected with parents s/he has home with -- s.4(3) 20 ● Decisive factor: immigration record ○ She only spent 10% of the year in HK shopping ● Held: no HK domicile [NO] W v C [2013] 2 HKLRD 602 CA ● Man had a mainland domicile as a child and adult ● Immigrated to New Zealand and acquired domicile ● Marriage broke up and decided to go back mainland ● He only spent 11 days in HK to get right of abode for his son in HK ● Held: no HK domicile, no connection with HK [NO] C v T[2017] HKEC 2265 ● Man in SZ and came to HK to check on investment ● No home in HK ● Son wanted to establish his dad’s domicile in HK after his death as he had 60M ● Under HK law of intestacy, son will get all only if dad has HK domicile ○ If mainland domicile, son and mother will get a great amount ● Argue on the basis that dad has a plan to allow son to study in HK then dad stays with him in HK → speculation ● Requirement: presence and intent to stay indefinitely ● Court goes into details of the argument: transcript of son’s eulogy son gave in funeral ○ Dad wanted me to go to US and study in Harvard ● Also, dad bought SUV in Mainland which the car plate can only be used in Mainland not HK ● Held: no HK domicile [NO] Lam Kwok Leung ● Held: no HK domicile ● Specialised computer in toronto but an ordinary computer not connected to internet in HK ● Did jury in Canada, president of photography club in Canada ● After wife (HK) died, he bought a grave in Toronto for his wife and himself 21 Answer structure: 1. Look at time: before or after 2009 March a. Before: common law rules b. After: DO 2. 22 LECTURE 3: CHOICE OF LAW IN TORT ● HK is one of the few countries that sticks with the double actionability law ● Black and white rule: if tort occurs in HK, HK law applies METALL und ROSTOFF ● “If in any given case the court concludes that under [HK] law a tort has been both committed by the defendant and committed in this country, we see no reason either on principle or authority why he should be entitled to claim exemption by reference to some foreign law ,and so we do decide”. China Medical Technologies Inc v Paul, Weiss, Rifkind, Wharton & Garrison LLP [2019] HKCFI 2631 ● “I consider that the plaintiffs have established, at least on a good arguable case basis, that the tort was in substance committed in Hong Kong. Applying the approach explained in Metall und Rohstoff, the relevant law that is applicable to the tort is Hong Kong law alone.” 1. Place where tort was committed ● Often tort involves many countries, it might be difficult to identify where the tort has committed at the first place ● Test: Look back over the series of events constituting the tort and ask “where in substance did this cause of action arise?” ● Important indicator: the place of tort is usually the place where tort advice were given to Defendant ● Focus on the place of acting instead of place of damage ● Trend: court is usually quick to conclude they have the jurisdiction to hear the case is the tort happened in its own jurisdiction **Distillers v Thompson Leading case in common law ● HL in Distillers case highlighted that: though it is tempting to find the place of tort to be where damage occurred, it may be fortuitous ● There is no one easy test 25 AGRI-PRODUCTS EXCHANGE LTD v WANG XIU QUN [2021] HKCFI lex fori unless the contrary is proved as a fact, the burden lies upon the defendant to plead and prove that his conduct is not actionable under the lex loci delicti.” Feature (3): Comparison of domestic and foreign law is on SUBSTANTIVE LAW where tort occurred HK cases PEI ZHENG MIDDLE SCHOOL v CHINA PUI CHING EDUCATIONAL FOUNDATION LTD [2010]HKEC 658 ● Tort of passing off ( a trader unlawfully misrepresents (acts misleadingly) that his goods or services are those of another trader) ● D set up a chain of school which misrepresented they were run by P in HK Held: DA rule satisfied ● HK court established that there is tort of passing off ● Mainland court also established the civil liability for D, even though in Mainland there is no exactly same tort ● DA rule is satisfied BIOZEAL LLC V NATURE’S STORY CO LTD [2021]5 HKLRD 75 ● Similar to above [No] 厦門新景地集團 有限公司 v Eton Properties Ltd [2016] HKEC 872 CA par 215-216 ● P brought claim in HK for inducement of breach of contract ○ D induced Mainland company to breach the contract with HK company ● Tort occurred in Mainland Held: failed DA rule ● Though in HK, tort of inducement to breach contract was well established ● Mainland expert revealed it is not a tort under Mainland law ○ No civil wrong of tort recognised under Mainland law 26 Limitation 1: foreign country has no civil liability on tort ● If the foreign country (lex loci delicti) has no civil liability ○ e.g. there is a “no fault” compensation scheme or contributory negligence is a total defence or there is criminal liability only ● P no claim in HK → no reward in favour of P even though tort is committed under HK law [No] McMillan v Canadian Northern Railway Co ● P injured at work ● Ontario law: worker injured in work is entitled to compensation ○ “No fault” compensation scheme ○ Entitlement to compensation is not dependent on any civil wrong in Ontario ● P went back to home state Saskatchewan, claim of tort Held: failed claim of tort ● Although in Saskatchewan, he has claim of tort ● He couldn't prove any civil liability on the part of employer in Ontario -- No fault compensation scheme Limitation 2: Defences abroad ● If there is civil liability in foreign jurisdiction but there is substantive law defence in the foreign jurisdiction that would reduce the amount payable to P ○ P claim in HK will be limited to the lower amount ● Example: different heads of loss → take the less amount ○ Pain and suffering damages available HK, say P can get 3M in HK ○ Mainland law does not have pain and suffering damages head, only loss of earnings ○ Under DA rule, P will only take the worst of the substantive law of both regimes → only loss of earnings damage ● Note: assessment of damages use procedural → no cap M’elroy v M’allister ● Scottish couple went to England 27 ● About 45 miles into England, car was hit to the negligence of another Scottish driver ● Husband was killed, wife sue negligence in Scotland ● Foreign tort in England, DA rule applies ● Problem with heads of loss: ○ Only head of loss identical between Scotland and England law was funeral expenses ● Wife only got the funeral expenses damage 3. Substance or Procedural damages** ● IMPORTANT!!! It is to decide whether DA rule has been complied with as DA rule is concerned with the differences in substantive laws ● If the defence is substantive → DA not complied with ● If the defence is procedural → does not affect the compliance of DA rule ● Under HK law, the wide view on what is procedure is advantageous for plaintiffs under DA rule ○ I.e. assessment of damages (procedural) ○ As DA rule application only concerns with the difference between substantive laws ○ If the issue is procedural, irrelevant to whether DA rule complied with or not ● Substance: liability, causation, remoteness, mitigation, contributory negligence, volenti, deny a particular head of damage ● Procedural: assessment of damages, limitations imposed on amount of damages e.g. Social security benefits deducted from damages ● However remember that if the ‘modern approach” to substance/ procedure is taken assessment of damages would be classified as substantive law ● A wide view of substance would reduce the chances of P’s success under the DA rule. John Pfeiffer v Rogerson Harding v Wealands** LEADING CASE ● P and D are married couple ● P is British, D is Australian ● Driving in New South Wales, D is the driver, lost control and car crashed ● P suffered from severe injuries and became tetraplegic Held: DA rule on negligence established but no compliance with 30 Held: English law applied, damages based on English substantive law to reward pain and suffering damages HK cases Kwok Yu Keung v Yeung Pang Cheung** ● Plaintiff injured by negligence of bus driver in Mainland ● P from HK, coach owned by HK company, driver HK resident ● Claim in HK problem: accident occurred in Mainland ○ Mainland no pain and suffering damages ○ Mainland no vicarious liability, cannot sue coach company for negligence of driver ○ DA rule not satisfied Held: court applied the exception as the connecting factors overwhelmingly relevant to HK Johnson v Coventry Churchill International ● English employer sent an English employee to work in a building site in Germany ● Injured in Germany on the building site due to the negligence of English employer -- no safe system of work ● DA not satisfied ○ German law, no fault compensation scheme, no civil wrong Held: exception applied, only connection with Germany is the place of tort occurrence English CA case explains the circumstances when this exception would apply Sophocleous v Secretary of State for The Foreign and Commonwealth Office [2018] ● A case where the common law rules on choice of law in tort applied because the events –violence (torts) committed by British soldiers in Cyprus -occurred 60 years ago ● The CA stated that the DA rule should be the one normally applied and the exception should not be applied too often to avoid it becoming the general rule ● Highlights the principle of comity, only apply exception in exceptional case 31 5. Avoidance of DA rule ● Due to the complexity of DA rule, one possible way to avoid DA rule is to claim in contract for breach of an implied term ● [EXAM] mention about concurrent liabilities of tort and contract ○ Service provider who provides defective services can be sued for negligence in tort ○ Also, can sue breach of implied term of care and skill in contract ○ Given that plaintiff is suing in tort Chan Wai Chung v China Travel Service [2022] ● Someone buying a HK ticket on coach to Mainland ● HK company books the trip in HK ● Someone is injured by the negligent driver in Mainland ● Does not refer to DA rule as P chose to bring the claim in contract 6. Reform of the law -- abolishing DA rule and the vague exception? [essay] ● No real plans in HK to depart from the DA rule for now ● In ZHANG RUI KANG v TUNGHSU GROUP CO LTD[2023] HKCFI 1866 the court proceeded on the basis that the double actionability rule is still the law in Hong Kong. (1) Mainland ● Abolished the DA rule ● Apply the lex loci delicti (governing be the place where tort committed) subject to two exceptions ○ If both parties have same country of habitual residence that law applies ○ If the parties choose a governing law after the tort occurred that law shall apply (2) EU ● Rome II took effect January 2009 ● General rule: applicable law would be the law of country where the damage occurs (lex loci damni) but not the country where tort was committed ○ Exception 1: Habitual Residence A 4(2) (so called cocoon rule) ■ If both parties habitually resident in a particular country when damage occurred, that country’s law applies 32 ○ Exception 2: Most close connected A4(3) -- similar to the exception to DA rule ■ If tort is manifestly more closely connected with a country other than those above. Manifestly more closely connected might be based on a pre-existing relationship between the parties, such as a contract which is closely connected with the tort. A very high standard is required to satisfy A4(3) ■ WINROW v HEMPHILL [2014] EWHC 3164 ; OWEN v GALGEY[2020] EWHC 3546(QB) ● EU: choice of law clause, assessment of damages regard as substance ● A14(1)(a) allows the parties to agree on what law should apply after the tort occurs ○ Where all the parties are pursuing a commercial activity, a pre-tort choice of law clause is allowed ○ But not effective where all the elements relevant to the situation at the time when the event giving rise to the damage occurs are located in a country other than one chosen. ○ Deter forum shopping ○ However, can refuse to apply foreign law if it is incompatible with public policy 35 ● Allow contracts to have different systems of law applying to different parts of the contract ● As long as the different parts are mutually consistent (4) Floating choice of law NOT permitted at the time of contract made ● Clause that does not state which law to be applied when disputes arise at the time of contract made ● E.g. “In the agreement specifies the law of the defendant’s country would apply if dispute arises” → floating ● Unclear clause ● Clause will be declared void ● Possible to change -- see below case The Mariannina ● Possible to change choice of law -- the clause of choice of law providing on the happening event ● Arbitration clause: In event of dispute arbitration in England, arbitration in England will apply, English law to apply ● Another clause: if the clause is declared to be unenforceable, Greek law will apply and Greek court will have jurisdiction ● Held valid ○ Parties have intention on the change of law in contract (5) Free to change agreed choice of law AFTER contract made ● Must be after contract made ● And there is an agreed COL at the time contract is made (6) Mandatory restriction ● = HK mandatory law overrides the foreign COL clause ● EU: laws to be applied on consumers is the law of their own country ● HK: comparatively less mandatory law to allow parties to contract out of by using COL ● Factor: real connection with HK HK mandatory restrictions (clear) -- consumers protection 36 S.17 Control Of Exemption Clauses Ordinance ● If consumer is making a contract in HK (habitually resident in HK) with parties outside of HK ● Consumers have rights under these two provisions to protect consumers that cannot be taken away by the express COL clause ● Foreign COL no legal effect under these two provisions ONLY S.7 Unconscionable Contracts Ordinance Situations where the Ordinances won't apply: ● Commercial contracts: no legal effect if party expressly choose HK as COL to evade CECO s.17(2) and UCO s.7(2) in order to get advantage of the two provisions ● If court decides HK law is not the proper law of the contract → no real connection with HK Chimbusco Pan Nation Petro Chemical v Arkstar Ship Management PTE Ltd [2019] ● Agreement between Singapirean parties that specified HK law to be applied ● Dispute arose ● One of the party want to rely on s.17 to argue that one of the exemption clauses is unreasonable Held: no reliance on HK law s.17 ● Contract has no real connection with HK ● Cannot get benefits of HK legislation by saying HK law applies Employment contract (unclear) Employment ordinance S.70 ● HK employment law: employee can buy themselves out of the contract ● Pay the employer the (..) months salaries and can get out of the contract ● Unclear whether employer can include a foreign COL clause which restrict employee to buy themselves out of the contract Conflicting HK cases 37 **Cantor Fitzgerald Europe v Boyer** EO is mandatory restriction ● Reyes J: EO is a mandatory restriction ● “One cannot attempt to get around the protection afforded by the EO to employees working here through the expedient of choosing a foreign law” HSBC v Wallace EO is NOT mandatory restriction ● Wallace from UK, contract with HSBC said english law applies (foreign COL clause) ● Judge upheld the English choice of law clause ○ Put in good faith ○ Easier to deal with any employment disputes with employees with unified COL clause 40 in HK CA and CFA criticised CFI decision: Mainland law should apply ● Choice of law had to be decided according to common law principle ● CA approved statement in Benjamin Sale of Goods, found shares contract analogous with goods ○ Strong case law which held that proper law is the country where the goods will be delivered into ● Lord Collin CA: EU law focuses on parties while CL looks at the place where performance was carried out ● D State-owned company in Mainland → place to carry out the contract is Mainland ○ Require Mainland authority to approve the transfer of shares ○ Parties agreed to engage Mainland lawyers to handle the transfer ● Mainland law applies Puzzling decision (1) Treat JV as an independent clause ● Extract one of the clauses (JV) from the entire agreement to derive with application of Mainland law decision ● Could have looked at the entire agreement ○ Non performance of one of the clauses ○ Place of performance of JV is Macau ○ Macau law should apply (2) Rule: Place of performance of shares transferred ● General rule: place of performance should be the place transferring shares occurs ● Not make sense to say the general rule of transfer of shares is where the shares take effect in ○ May result in country with little connection between parties Amin Rasheed v Kuwait Insurance 1984 ● English law has the closest connection ● P came from Liberian ● D from Kuwait ● Entered into marine insurance agreement but no Kuwait law 41 on marine insurance matters ● Contract can only be interpreted by applying English law even neither party have connection with England HIGHWEIGHING!!!!! (i) Country of the intended performance (lex solutionis) Rule: Country of the intended performance is the country where the goods are to be delivered to ● Comes from Swiss law: characteristic performance of the contract ○ Parts of the contract that makes the contract unique ○ Non-money part of the contract ● In sales of good contract, easier to identify the country ● In money for money contract e.g. contract to lend money, guarantee agreement ○ Persons who has to repay the money → the performance ● Deualt rule: money owed to be repaid in creditor’s place Problems with Place of Performance factor ● In certain contracts, place of performance does not work easily ● Example: ○ A (HK) sells goods to B (France) knowing that B has resold the goods to C (Germany) OR ○ To fulfil the contract A has the goods manufactured at D’s factory (Vietnam) ● Note: HK court still relies much on this factor to determine the proper law nevertheless Bank of India v Gobindram ● Whether Indian law apply or Japanese law apply to a guarantee agreement ● Guarantor -- Indians brothers ran a business in Japan ● Under the terms of agreement, any money owing under the guarantee had to be paid in Japan ● Little connection with India ● Held: Japanese law applied 42 XiangJun v Cheng Chiu Tung Gregory ● HK debtor, Mainland creditor ● Contract did not mention where the money had to be repaid ● Court applied the common law rule -- if the contract is silent about where the money be rapid, it is the obligation of the debtor to find the creditor and repay at creditor’s place Held: Mainland law applied [No] The Cavalry [1987] ● HK guarantor tried to argue loan agreement void under HK money lenders ordinance ● Has to establish HK law applies ● International lending agreement: Lender from Bahamas, Lending USD to Panamanian company ○ Money lent in NYC and to be repaid in NYC ● HK connection: agreement negotiated, drafted and signed in HK Held: HK law does not apply, but NYC law ● Proper law of the contract is NYC law as money was to be repaid in NYC Hong Jing LTD v Zhuhai Kwok Yuen Investment Co Ltd CA case ● Bank of China not being paid by D from Mainland for a long time ● D found P from Macau to provide securities and pay debts owing to BOC by D Held: Hk law apply reasons -- ● Subject matter is repaying a debt owing to a Hong Kong bank ● Place of performance is in HK according to the contract agreement (ii) Country specified in EXCLUSIVE arbitration/ jurisdiction clause Rule: If contract includes an exclusive jurisdiction/ arbitration clause and the contract is silent on which to be applied, the specified country law will be applied ● Logically has the closest connection ● Parties impliedly intent to make the country with exclusive jurisdiction to also govern the whole contract 45 Fei Yu NOT important Little weighing (vi) Country of legal terminology S Megga Telecommunications v Etowaru ● HK law applied ● Contract referred to legal concepts that were unknown under Japanese law ○ I.e. liquidated damages (not JP concepts) (vii) Country where contract was made/negotiated ● Previously: if contract silent on which law applies, apply the law where contract was made ● Dropped in favour of the proper law First Laser ● Not very strong indicator ● “Little weight in modern circumstances” Hong Jing Co Ltd ● The fact that negotiation and signing of the agreement is in PRC was a relevant factor but not significant in identifying proper law (viii) Country of domicile/ residence of the parties ● Only works if parties reside in the same country (ix) Language of the contract ● HK court: no relevance to which law apply (x) Currency referred to in the contract Sapporo Breweries v Lupofresh ● Whether English or Japanese law apply ● Contract drafted in English may give little weight to applying English law 46 3. Putative Proper Law -- validity of contract ● Where dispute is concerned with whether a contract has been formed and what law applies? ● Common Law approach: apply the law which would be the proper law of the contract if the contract was validly concluded + look at which country has the closest connection with the pre-contractual negotiations The Parouth [1982] / **Lew v Nargolwala [2021] ● Apply what would have been the Proper Law + look at pre-contract negotiation ● Which country has the closets connect with the pre-contract negotiation → apply the law ● Australian billionaire (P)selling his villa in Thailand to a Singaporean couple (D) ● SG couple argued: no contract formed for the sale of villa to them ● Pre-contract negotiation: ○ D said that they would engage in SG lawyers but instead found Thai lawyers ● Subject matter: Thailand ● Place of negotiation: Thailand Held: Thai law applies ● → most closely connected to the pre-contractual negotiations 4. Foreign Illegality/ Public Policy**** -- exception to Proper Law test Steps when handling foreign illegal contract dispute (1) Find the proper law of the contract (2) If proper law says the contract is illegal, then it won’t be enforceable in Hong Kong ● Contract illegal under its proper law is not enforceable in HK, even if it is legal in HK ● Importance in HK: in dispute related to financial issues, parties tend to argue the contract is illegal under HK law 47 ● Limited scope of the rule, facts have to fit in exactly ● Common intention to evade the law Rule 1: Contract that is illegal under its proper law is not enforceable in HK Rule 2: Contract is legal in HK, proper law is HK law, place of performance is illegal, unenforceable in HK ● Inconsistencies: unreasonable to exclude the contract that is legal in HK ● Justification: comity, respect for other legal system which the performance of contract is illegal Ralli Bros v Compania Naviera Not enforceable in HK ● Contract governed by English law to carry goods to Spain ● Valid under English law and Spanish law ● Before goods being sent, Spain passed new law limiting the total amount one can charge for sending new cargo to Spain ● While in England, legal Held: Unenforceable contract under English law [No] Foster v Driscoll Not enforceable in HK ● About place of performance ● If both parties intend to carry out a contract in a country where it is illegal → HK will not enforce the contract ● Contracts of ships transporting goods ● Contract did not specify the place of performance ● Parties have a common plan to carry a cargo of whiskey and smuggle it to the US ○ US has banned alcohol during the prohibition period ● Held: unenforceable contracts ○ Comity → respect of US law SPLIETHOFF’S v BANK of CHINA [2015]EWHC 999 ● English law applied, place of performance in England ● D argued that under PRC law is illegal and therefore should not be enforceable ○ Absurd arguments 50 The Convenience Container ● Progress in HK under SG law ● Companies from TW ● Argument: Taiwanese under company law, they do not have the capacity to make the contract ● Refers to TW company law Integral Petroleum SA v Scu-Finanz AG ● Danger of the rule ● Two Swiss contract, contract of buy and sale of petroleum, contract governed by English law ● Swiss company only has the capacity if the contract was signed by two company rep called Prokurist ● In the agreement, seller only has 1 rep signed the agreement Held: matter of capacity -- Agreement was null and void between parties ● Swiss company does not have legal authority to make contract unless the company rep signed the contract ● Apply Dicey -- apply law of incorporation of company in Switzerland ● “A legal person as a company cannot exercise a greater par given to it by the legal system to which it owes its existence” ● Protection: include clause under which the company gives a warranty that the company has the capacity to make the contact ○ Can sue the company for breach if it happens 5. Formal Validity ● Rule: contract is enforceable only if it is valid by the proper law or the law of the place it is made ● European approach: HK judges tried to apply by analogy European approach ○ Fundamental differences between EU and HK law: presumptions concerning different types of contracts 51 ■ Absence of choice Art.4 ○ Attitudes towards the decision of closest connection test for proper law ■ HK: geographical and non-money side of contract -- country closest connection to the contract European countries presumptions focus on parties -- where do parties live Absence of Choice Art.4 ● Sales of goods or services contract -- supplier’s country of habitual residence is the proper law ● Sales of good by auction -- country where auction is held ● Franchise contract -- habitual residence of franchisee ● Distribution contract -- habitual residence of distributor Definitely Maybe ● Oasis (band) from England contract to put a concert in Germany ● Presumption: supplier’s country of services -- Oasis supplying singing and performance ○ UK applies ● However, court decided factors were overwhelmingly connected with Germany ● Held: German law applies 52 LECTURE 6: MARRIAGE 1. Recognition of foreign marriage ● Starting point: if the law is valid according to the foreign law of the country the marriage takes place, the marriage is valid ○ Danger: evade the law of one country → lose control of the marriage aspect in law ● Current law: separate formalities from capacity to marry ○ Formalities: procedural rules to comply with ○ Capacity: fundamentals that make up a marriage ➢ Single ➢ Consanguinity ➢ Age ➢ Consent ● Common law judges dislike the rule of applying foreign country law of marriage regarding formality issues ○ Lost control over what mariage could be recognised in England ○ Concerned with different practices in Muslim country -- polygamy, young girls getting married, ● Take back control through rule of capacity Rule 1: ● if the issue is about formality, lex loci celebrationis (law of foreign country that marriage takes place) applies ● Examples of formality issues: proxy marriage, parental consent of marriage, number of witnesses,notice required,who can conduct the ceremony ,the type of ceremony Formalities issue cases Berthiame v Dastous ● French marriage ○ Formalities: Church wedding and civil wedding needed ● Parties only have church wedding → not recognised in England as a valid wedding 55 **Westminster City Council v C ● Wall LJ: court should not use these rules to decline the recognition of marriage where the lex fori has no good reasons NOT to recognise ○ If the marriage is one should be recognised, the lex fori should use any rules it takes to achieve that result (to recognize the marriage as a valid one) ○ Use other rules that create a sensible result Case summary: ● UK courts made it clear it would not recognise the marriage, will use the lex fori rules to achieve the result of not recognising ● UK domiciles man with mental age of 3 only ● Married with a mature woman in Bangladesh, valid in Bangladesh ○ Created problem: if wife had sex with man in England → committing sexual offence ○ Diminished capacity of the man to give consent Held: marriage is not valid under both Dual Domicile test and Intended Matrimonial Test ● Dual Domicile test: invalid under England law → failed ● Intended Matrimonial test: parties intended to domicile in England, governing law would be England → invalid marriage → failed (b)Dicey Dual Domicile Test****** ● Marriage can only be valid if at the time of marriage, the marriage is valid under the domicile of both M and W at the time of the marriage ● Negative of this rule: difficult to comply with this standard Nachimson v Nachimson ● Russian marriage was not valid as under the law in Russian, marriage can be easily divorced ● If party inform the other to divorce → divorce ● Argued that marriage can ended too easily Held: yes valid ● Court: focus should be on the validity of marriage, the 56 answer is yes (i) Consanguinity [No] Brook v Brook [No] Re Paine ● Consanguinity ● Dual domicile rule applies ● Similar scenario where man wants to marry his deceased wife's sister -- more of an affinity issue ● Bible prohibits marrying deceased wife’s sister ● Rich British guy will get married with women in other jurisdiction where affinity marriage is allowed ○ Pakistan country, Indian country ● Judges apply the dual domicile rule to avoid the marriage Sottomore v Barros (no. 2) ● Reversed situation where marriage was upheld ● Exception to the Dual domicile rule Cheni v Cheni ● If the marriage is valid by law of parties domicile (foreign), then it is also valid in HK ● UNLESS against public policy of HK (ii) Lack of Consent ● Mistake to identity, duress, mistake to nature of ceremony s.20(2)(c) Matrimonial Causes Ordinance ● Grounds not to recognise the marriage ● HK domestic law: marriage is voidable if either party to the marriage did not validly consent to it, whether in consequence of duress, mistake, unsoundness of mind of otherwise ● Relevant application: arranged marriage in countries in Pakistan or India [No] Szechter v Szechter ● Polish residents H and W ● W got into prison ● He divorced his wife and married in prison with secretary to make a deal to get his wife out ● Immigrated to Israel together and later both domiciled in England ● Wants to remarry his first wife again -- valid? 57 Held: invalid marriage ● Under Polish law, marriage is made under duress -- the fear that W would get killed in prison ● Not recognised ● Failed DD test RM v AY [2023] HKCU ● Girl, HK permanent resident, forced by family in HK to go to Pakistan and marry a man there ● Day before wedding, dad assaulted girl to force her to get married ● Marriage under duress ● HK court did not recognise the marriage ○ Under Dual Domicile rules, marriage is still valid in Pakistan but invalid in HK Clarification of Dual Domicile Rules -- lack of true consent ● For protection of vulnerable women who is forced into marriage against her consent ● Unfair to apply the dual domicile rule ● Focus should only be on the person who is alleged to be lack of consent ● Best solution would be to apply the law of the person who is alleged being lack of consent Situation where the woman wants to stay in the marriage, possible exploitation of H by forcing a divorce ● Where marriage is not valid under W’s domicile law ● Fail the DD test and end with a divorce that is against W will (iii) Lack of Age Mohamed v Knott ● Couple domicile in Nigeria at time of marriage ● Girl only 13 years old ● Valid under Nigerian law but not in English law Held: Upheld marriage as both domicile in Nigeria [No] Pugh v Pugh ● Mature English colonel marrying a 15 year old Hungarian girl in Austria ● Under Hungarian law, she could get married ● Failed DD test because England law that no English 60 ● Prostitute marriage (man pay a sum of money to woman’s family to marry her) → if it is made under duress → against public policy (i) Same sex marriage recognition in HK ● According to s.4 Marriage Reform Ordinance: “.. the voluntary union for life of one man with one woman to the exclusion of all others.” ● Same sex couple cannot get married in HK → invalid marriage Same sex marriage in FOREIGN COUNTRY ● If couple gets married in country that permits same sex marriage, then comes to live in HK, recognised in HK? ● Apply the ordinary COL rules (1) Satisfy the formality rules (2) Satisfy the dual domicile rule (normally stops the marriage at this stage if one of the parties domicile in HK) (3) Not contrary to public policy in HK Changes on public policy ground in HK ● High degree of liberalism in HK court ● Present status: no public policy considerations that would prevent recognition of a same sex marriage in HK ● Leung Chun Kwong v Secretary for the Civil Service & Ors [22019] HKCFA: ○ It would not be against public policy to allow same sex couples the same benefits as heterosexual ones as this would in no way weaken the institution of heterosexual marriage in Hong Kong ● No obvious reasons for HK courts not to recognise same sex marriages ○ No duress ○ No underage issues ○ No consent issues ● Main problem is the Dual Domicile Test 61 ○ Likely to fail the test ○ If one of the parties domicile in HK, marries abroad in country where same sex marriage is permitted ○ Marriage will not be recognised ○ Under HK marriage law, same sex couple cannot marry Sham Tsz Kit v Secretary For Justice ● Marriage in New York, domicile in HK → failed DD test ● Claiming of constitutional right to get married under Basic Law Held: no constitutional right to same sex marriage ● The law clearly stated that same sex marriage is not permitted ● Bill of Right Ordinance: “The right of men and women of marriageable age to marry and to found a family shall be recognized” ● No rights under either Basic Law or BORO that gives such right (ii) Concubine妾 ● Old Chinese custom: wife could not bear male child, husband allowed to find a “secondary wife” who does not carry the legal status as a wife ● Permitted in HK until 7th Oct 1971; Mainland until 5th May 1931 ○ Up until the abolish date, concubine enjoys the same intestate rights as the official wife ○ Children of a concubine can inherit if “husband” dies intestate ● HK court will find the concubine relationship VALID (CFA) -- apply the same rule as the COL rule → Dual Domicile Test Suen Toi Lee v Yau Yee Ping [2002] ● Regard as a valid concubine relationship ○ Period between 1931 and 197 ○ A man and lady both domicile in HK ○ Went through concubine ceremony ○ Will be recognised (iii) Polygamy ● Cannot have a polygamous marriage in HK irrespective of fact that both parties are domiciled in a country permitting polygamy and that they go through a ceremony 62 which would have been a valid polygamous wedding ceremony in their country S 4 Marriage Reform Ordinance ● Marriage outside HK of a HK domiciled party –dual domicile rule applies ;cannot contract a polygamous marriage abroad or even a potentially polygamous one HYDE v HYDE ● This caused hardship as it meant the marriage was not recognized, even though it was actually monogamous, simply on the grounds that the HK domiciled man had married in a foreign country in a ceremony where he could have taken more than one wife RE BETHELL . ● Changed by HUSSAIN v HUSSAIN . HK domiciled man not already married goes through polygamous ceremony in foreign country to a lady who is single-marriage valid under dual domicile rule. ● One difficult point is what happens if a woman domiciled HK marries a man domiciled Pakistan (polygamy permitted there) .She marries in Pakistan. Polygamous? ● In Radwan v Radwan(No 2) it was decided that in this case the law of the intended matrimonial home should apply-therefore if they intended to live in Pakistan the marriage would be a valid polygamous marriage as it is a valid marriage by the law of the country in which they are going to live. 65 THE MESSINIAKA TOLMI [1984] 1 Lloyds Rep 266 Effect of submission = preclude from objection afterwards ● Lord Goff at p270 “ The effect of a party’s submission to the jurisdiction is that he is precluded thereafter from objecting to the court exercising its jurisdiction in respect of such claim” [No] LAM YUK CHEUNG v MAISON RIVIERE FILS [2014] HKEC 1022** ● D had been submitting documents to HK court ○ Writ issues in 2013, defence and counterclaim Jul 2013 ● D supplied to amend pleadings 2014 ● March 2014 final challenge submitting that HK does not have the jurisdiction Held: Rejected amendment of pleadings, agreement by conduct ● Party act as if they are submitting clearly to the jurisdiction to HK court ● Act as if a normal defendant What are not submissions? HWOO HUANG LINDA v FU BEING SAN [2013] 1 HKLRD 259 ● If party merely acts to preserve the status quo pending the mounting and resolution of an application to challenge forum ● If party merely takes defensive action in interlocutory injunction proceedings brought by the other side ● Party may be able to preserve an option to challenge forum (even if he engaged in conduct that is submissions) IF he makes it clear that his action is without prejudice to the bringing of a challenge to forum ● Court should take a commonsense approach ● Should not be quick to conclude a party has submitted to the jurisdiction ● The real question is whether a party's conduct is so inconsistent with maintaining an option to challenge forum that the party should be assumed to have waived such option. (2) Service in HK (a) Individuals 66 ● Writ is served on you in HK → jurisdiction as of right ● Presence is enough to allow court has jurisdiction as of right Dynasty Line v Sukamto Sia ● Despite no real connection with HK, jurisdiction is as of right ● Writ served on D at HK airport when he was passing through HK Maharanee of Baroda v Wildenstein ● Closely connected to France ● England has the jurisdiction as the writ was served on D in horse races in England (b) Company ● A managing director who pass by HK and was served with writ in HK airport, not enough to allow HK court has jurisdiction as of right ● But if a process agent was served with writ in HK → yes ● Process agent clause in agreement: in the event of any dispute the company has to appoint an agent in HK to accept any writ ○ Meaning HK will have jurisdiction as of right if PA was served with writ in HK ● Foreign company with HK presence: enough if writ served on their business premises that they have during the last 12 months in HK [No] Huang Ping Owen v Burswood ● Writ served in office in Shan Tak on an Australian company ● Held: not valid service as no evidence that company has done business in that particular office (3)Service outside the jurisdiction -- Long arm jurisdiction ● Presumption: another foreign jurisdiction is more appropriate ● Usually no connection to HK ● Very wide jurisdiction ● Need court’s consent → Order 11 rule 1 Easy way O11 rule 1 (1)(a) Defendant’s domicile D was domiciled or ordinary resident in HK (a) If contract was made in HK, HK may have the jurisdiction 67 Rule 1 (1)(d) ● Court can have jurisdiction over a contractual claim if contract made in HK Note: won't apply strict rule of offer and acceptance Apple Corp v Apple Computers Liberal approach ● Find out where the contract was made -- California or england ● Only have transcripts of emails and calls between two jurisdictions ● Clear that contract was made but virtually impossible to find out where it was accepted and communicated Held: if it is not clear where the contract was accepted and communicated, it would be pragmatically be viewed as in BOTH countries ● Law out of step with modern methods of communication and a more liberal approach to where the contract is made is now adopted (b) If contract was governed by HK law Rule 1 (1)(d)(iii) … is by its terms, or by implication, governed by Hong Kong law (c) Breach of contract committed in HK ● Usually about non payment of money ● Default common law rule: if there is no expressed or implied agreed place of performance, payment is deemed to occur at the creditor’s place of business O11 rule 1(1)(e) ● Breach of contract that occurred within the jurisdiction, regardless of whether the contract was made within or outside the jurisdiction. ● It doesn't matter if there was a breach outside the jurisdiction that made it impossible to perform part of the contract within the jurisdiction [No] Huang Ping v Owen Burswood ● Parties try to argue HK has jurisdiction ● However, money was paid in Australia (place of performance) ● HK no jurisdiction Union Bank of India v ● Contract: payment had to be made into a US bank 70 2. FORUM NON CONVENIENS**** ● Filter to stop HK hearing cases that have little connection with HK ● In determining whether the court will grant or refuse a stay of an action brought in Hong Kong, the court will view the issue in 3 separate stages (Spiliada Maritime Corp v Cansulex Ltd [1987] AC 460). ● Stay of proceedings = a court trial is stopped temporarily or ended by a judge Presumptions IMPORTANT!!! -- decide which is most appropriate if there is no significant factors to any jurisdiction As of right - D prove another foreign more appropriate Long arm - P prove HK more appropriate Rule: ● If the court technically has jurisdiction there is general discretion to stay proceedings in HK if the court thinks another forum is more appropriate for the trial of the action ● Equally, even if proceedings have started in another country, HK court if it has jurisdiction, has the discretion to decide it is the forum conveniens → case be heard in HK ● Can even order an anti-suit injunction to discontinue proceedings in foreign court ● IMPORTANT: must first establish HK has the technical jurisdiction ● Plaintiff friendly, even if lost in stage 1, might argue again in stage 2 ● Lengthy and unpredictable results from FNC rules! [essay] THE TEST IN HK -- The AGHIGUNA [1987] Spiliada “The basic principle is that a stay will only be granted on the ground of forum non conveniens where the court is satisfied that there is some other available forum having competent jurisdiction ,which is the more appropriate forum for the trial of 71 the action i.e in which the case may be tried more suitably for the interests of the parties and the ends of justice" Goff LJ Stage 1: comparative exercise ● The applicant must establish two elements: 1. Hong Kong is not the natural or appropriate forum, i.e. the forum has the most real and substantial connection with the action 2. There is another available forum which is clearly or distinctly more appropriate than Hong Kong Stage 2 ● The respondent must show that he will be deprived of a legitimate personal or judicial advantage if the action is tried in a forum other than Hong Kong Stage 3: balance by court ● The Court will have to balance the advantages of the alternative forum with the disadvantages that the plaintiff may suffer. ● Deprivation of one or more personal advantages will not necessarily be fatal to the applicant for the stay if he is able to establish to the court's satisfaction that substantial justice will be done in the available appropriate forum. ● CA: stage 1 factors overwhelming connected with SK ● Stage 2: powerful factors on grounds of justice it should be HK ● Decided in favour of stage 1 even if P would have gotten more compensation under HK law (1) Burden of Proof ● Very high burden of proof standard on D to prove HK is not the best forum ● If HK has jurisdiction as of right that presumes HK as the best forum, D has the onus to prove not ● If P relied on long arm jurisdiction rule, P has the burden to prove HK is the more appropriate jurisdiction than the one D suggests (2) No FNC raised if D does not identify any defence to P’s claim 72 ● E.g. D does not give argument on why the jurisdiction is not appropriate or more appropriate [No] Xu Ziming v Riufeng Petroleum Chemical Holdings ● Money owed by D ○ Didn't pay because of cash flow problem → legal defence ○ Argument: should go ahead in Mainland court that is more appropriate jurisdiction Held: D haven't put forward any defence to why D did not pay money ○ No FNC application [No] SHENZHEN CTS INTERNATIONAL LOGISTICS v DAJIANG INTERNATIONAL INVESTMENT ● Mainland company unable to deliver goods to HK company ● Incurred storage charges ● HK company sue D for compensation of storage charges ● D defence: we think Guangzhou maritime court is more appropriate ○ No legal defence to why they have not paid P Stage 1: comparative exercise ● Question asked by court: is somewhere else more appropriate than HK? ○ If answer is yes → P who wants to have case heard in HK still has second chance in Stage 2 ○ ask: will a trial in another jurisdiction deprive P of any “legitimate personal or juridical advantages?” ● Judge compare HK with foreign forum which is best ● The other forum must be named by parties ● HK and Mainland: court system in Mainland is not consistent ○ HK court: if want to consider FNC in favour of Mainland, has to mention which Mainland court to compare with HWOOHUANG LINDA v FU BEING SAN ● Party : USA is more appropriate ● Court: can't do exercise here, no specific state to compare ● Must identify which law jurisdiction to compare with Wong Chi Hung ● Pleading just state that Mainland is more appropriate 75 ● Pragmatic rule: the fact there could be parallel proceedings is not by itself fundamentally decisive ○ E.g. started in Mainland first before HK, irrespective of which is the best forum ○ Generally, HK court will not find it problematic if proceedings have already started in elsewhere ○ Has to be extreme grounds China Construction Bank ● Commenced in HK ● P and D ordered by Mainland company to get involved in Mainland proceedings that involve the same issue as HK ● When case came to HK, application to stay in favour of Mainland, Mainland proceedings were already advanced ● P success in first instance proceedings in Mainland ● Being appealed in Mainland ● HK court: waste of resources to have case in HK when Mainland proceedings already so advanced ● Decision to discontinue HK proceedings ● Neither party is responsible for the parallel proceedings BRIGHT SHIPPING v CHANGHONG GROUP ● No obvious natural forum for dispute, about collision at sea, actual negligent takes place in international waters ○ Hundred miles away from Mainland, Japan and South Korea ○ HK jurisdiction? ■ P ship no HK connection ■ D ship has HK connection, registered in HK (crucial) can serve writ on D in HK → jurisdiction as of right ■ Up to D to establish Shanghai maritime court is a FAR more appropriate forum than HK ■ P brought proceedings in HK, on the same day D brought proceedings in Shanghai (parallel proceedings in SH as insurers bring claim against both P and D) ○ Stage 1: P has jurisdiction as of right, does D have strong argument to conclude Mainland is far more appropriate ■ No overwhelming factors 76 ○ Court highlights where there is no natural forum for the dispute, strong arguments have to be taken out to prove jurisdiction is far more appropriate ○ No big issue with witnesses being 2 fishermen in Mainland, court happy to accept their testimony through video ● Held: HK court has the jurisdiction (f) Multiple parties but not all same EJC ● Co-defendants should have one set of proceedings only ● E.g. 4 out of 5 submitted to HK jurisdiction, common sense that the fifth defendant should be heard in HK as well ● Equally, if HK only has jurisdiction over 1 and 2 while Mainland has all 5, Mainland should be the appropriate jurisdiction over all D (g) Law governing dispute ● Usually, the appropriate jurisdiction should be the country of the law governing the dispute i.e. HK law to be applied in the case, then HK court should be the most appropriate jurisdiction to hear ● Foreign law: just because foreign law is involved, that itself is not a significant factor in favour of a foreign jurisdiction ● Judge’s discretion: if the issue of foreign law is complicated, strong factor in favour of case going to foreign court ○ Unpredictable to know when will court decide the case is complicated ● Mainland law: HK judge quick to conclude they are competent to deal with an issue of Mainland law Botanic Ltd ● Court confident about his knowledge of Mainland law, even disagree with the sole expert of Mainland, Limits to the degree HK judges consider if they are competent to reach decisions on mainland law ● Danger where court is not familiar with foreign law even with the foreign witness help → let foreign forum hear Excelsior Capital ● involves claim against a firm of Shanghai solicitor for professional negligent ○ HK judge decides better let the case go Mainland 77 ○ One of the main issue in the case: whether the lawyer in the case has fallen below standard to be reasonably expected as a Shanghai lawyer ○ Also issue on whether a partner could be personally liable for professional negligence Chen Lingxia ● Principle of certain Mainland law is still boeing developed in Mainland, better let Mainland be the jurisdiction ● On the other hand, HK courts less willing to accept foreign courts are as competent to deal with issues of HK law Hartanto Hardy ● Issue of construction of contract ○ Mongolian court argued to be more appropriate ○ Interpretation of contract governed by HK law ○ HK judge: HK more appropriate forum for the meaning of contract ○ Contract in English, HK judge knows HK rules on how to interpret the wordings ‘if case went to Mongolia, contract will have to be translated into Mongolian, interpreters needed to explain to judge there etc. ○ Also P has no knowledge of Mongolian, while D has knowledge of English ○ Simpler to have HK court be the forum Khattita ● P (Qatar) had a ship and in collision with D ship (Indian ship) in the UAE water ○ DA rule: jurisdiction be where the tort is committed → ○ However, Qatar and UAE were enemies at that time, fear for unfairness in UAE county ○ P asked to have case heard in England ○ Court: both parties represented by London shipping lawyers, no real difficult issues with UAE law where quantum was the issue left 80 HK case Dyson ● Case over patent rights ● Case going on for 5 years ● P came to HK court to ask for the case be heard in English Patent court ● Evidence shows it might take up to 8 years if the case were to be heard in English Patent court ● HK court rejected: delay is unacceptable, continues go in HK Criticism of FNC: ● Too pro-plaintiff ○ Divergent COL rule: with COL clause in agreement, there is evidence if case goes to FJ, they will ignore the COL and apply own mandatory rule and applicant will certainly lose ○ A strong reason in Stage 2 not to hear case in FJ Golden ocean ● Party sue guarantee on the guarantee agreement ● English law is the COL ● Evidence that if case went to India (more appr), the claim under guarantee will certainly fail ● As Indian court will apply foreign exchange management guarantee legislation, declare guarantee void ● Where case heard in England, good chance to be successful 3. Fair trial (hard) ● Huge call if judge conclude P will not get a fair trial if the case is heard in other jurisdiction ● Must show evidence ● On the other hand, judges recognise such possibility MB & Services v United Company Rusal ● Mr. Depriska close to Putin, alleged influence over US presidential election, he is a character of wealth and importance to Russia, that may influence results of any litigation in Russia 81 Cherney v Deripaska ● Cherney (rival of Putin) said he wont get a fair trial if he goes to Russia ● Even danger of life ● Court accepted: evidence also given D has approached P lawyer and offered bribe if lawyer would drop P in the case ● Lawyer too afraid to give affidavit fear for safety of family in Russia ● HK situation on unfair trial: ○ In case of D who has strong connections to particular government and that judges in that country will likely be influenced by that government to come to decision in favour of government China International Fund Ltd v West China Cement Ltd [2020] ● D very closely linked to government in Mozambique, major project to produce cement in Mozambique ● Election year, project will bring wealth ● P has major shareholding in the plant ● Court: if P goes to Mozambique, he has slight chance to win due to the influence of D in Mozambique ○ No fair trial when D is strongly connected to M government ● BUT comity!! ○ If party wants to be successful in raising fair trial ground, cogent evidence must be provided of lack of a fair trial in FJ [No] Pacific International Sports Clubs v Soccer Marketing International ● Whether case should go ahead in Ukraine or England ● Research done to support the view that P is an enemy of U gov will not get fair trial in U ● In depth evidence ● Conclusions in corrupt country in the country: Ukraine very corrupted country ● Relied on policy paper: widespread corruption in U judicial system ● Also relied on public survey in U: judicial system very corrupted ● Judge: not strong enough ○ General anecdotal evidence that a country has a 82 corrupt judiciary not sufficient ○ Must prove P would not get a fair trial in the case Briggs view on fair trial grounds Forum Non Satis: Spiliada And An Inconvenient Truth ● Correct thing is to let the case go to foreign court ● If the judgement is going to enforce in HK, by then outcome of trial can serve a evidence to decide whether fair trial done or not ● At enforcement stage, can have defence judgement procured by fraud AK Investment v Kyrgyz Mobil Tel Ltd ● AK Investment convinced Privy Council they will not get a fair trial in Kyrgyzstan ○ Not given notice to start until the morning of trial ○ Expert witness produce evidence without warning → no chance to dispute that evidence ○ Judges no convincing reason and refuse to honour the arbitration clause ● Bad experience in previous trial shows that P will not get a fair trial in the next trial Mainland situation on fair trial: ● Judges in Wuhan took bribes ● Local protectionism: poorly paid judges by government in smaller states ○ When case features local company, local government outs pressure on judges to decide in favour of those parties ● HK attitude: fine line between making clear they don’t believe in Mainland legal system and also being not to critical ● Balance between two ● BJ, SH, NJ are regarded as high quality → cannot over generalise the issue of local protectionism to argue that party will not get a fair trial in Mainland ● Evidence must be clear -- HARD to establish ● To date, no one has successfully argue at stage 2 on fair trial reason [No] New Link CONSULTANTS v AIR CHINA [2004] Need strong evidence to show ● One of the parties state owned company ● Argue won’t get fair trial if foreigner litigating against state own in Mainland ● Judge concluded that there was not adequate evidence party will not get a fair trial in M ● Not good enough just to make general allegation ○ Show evidence 85 7. Superiority of HK legal system -- hard ● Strong judgement by Lord Goff: comity, normally not good reason to allow case go to country simply on the basis the legal system of other country is inferior HAITONG INTERNATIONAL SECURITIES v ADS SECURITIES ● Fact that party can recover all legal costs in HK compare to UAE → insufficient reason to have proceeding stay in HK Performing Right Society Ltd v Qatar Airways [2020] EWHC 1872 ● Also no to say HK judge more qualified ● Performing right society; argument should go to England, they have specialist IP judges and Qatar does not have ● Not accepted ● However, when it comes to Mainland, Hk courts have neen quick to use this reason to conclude case should go in HK ZJW v SY [2016] HKEC 2219 ● Fact that HK discovery of document system is so superior than in Mainland ● Mainland system on discovery of documents: party only required to disclose document favourable to them, completely opposite to HK (disclose all used and unused materials including those that might not be beneficial to party) ● Lady petitioning for divorce in HK, Nuanland husband deliberately provide complex list of companies make it difficult to know the real value of assets in HK ● If case in HK, under hk system, she can find out the accurate value ● But not in Mainland Shenzhen Futaihong Precision Industry Co Ltd v BYD Co Ltd ● Allegation that D had been responsible for stealing P trade secrets ○ Court: this can be obtained easily under HK syste but not in Mainland 86 ○ Also, damages P claiming 5M rmb, in mainland the most they can get is half million ■ Some remedies not available in Mainland ○ HK more appropriate ● HK comparatively more up to date → can be a good reason ● If party can get substantially more damages in HK→ good reason THE ADHIGUNA MERANTI ● If case go to HK, P will get 1.27Musd for damages ● While Indonesia, maximum only 2541 dollars as they have not updated ● HK more appropriated BRIGHT SHIPPING v CHANGHONG GROUP ● Mainland has not updated their limits since 1976, HK updated 2012 ● HK can get 3.67 times more than Mainland PUSAN NEWPORT v ‘MILANO BRIDGE ● If Korea, maximum 24M, Hk 82M Stage 3 ● General rule; stage 2 trumps stage 1 ● If they lose at stage 1 and win at stage 2? ● HK balancing exercise: see above cases ○ Pusan: everything connect the case to SK -- one exception ■ Only connection with HK, they serve writ to D in HK ■ Stage 2: HK more substantial damages ■ Natural forum: SK -- stage 1 trump stage 2 ○ Meranti: trump ■ Amount get in FJ is so so small ■ At least Pusan can get 24M ○ Bright SHipping: trump ■ Connection ■ Stage 2 decided on favour of HK Criticism: 87 ● Current system is unsatisfactory, over complicate matter on deciding jursidiction ● Encourage lengthy litigation ● Rules unpredictable in many cases ● Pro plaintiff and anti D Justification: ● Wide jurisdiction rules that give court the technical jurisdiction over wide range of cases ● Lord collins: O11 rules allow cases to come to HK even there is hardly any connection with HK, FNC filter out 90 ● Legal certainty supported by the application of EJC ● To minimise jurisdiction dispute and to maximise legal certainty (a) Exception to EJC -- strong cause needed!! ● EJC will normally be upheld unless there is “strong cause” ● Not accepted reason: lack of credible defence Deltatre Spa v HK Sports Industrial Development Ltd Strong cause definition ● Something unforeseeable at the time of contract, or ● Dispute of streaming of football match in Asia between HK company and Italian company (dominant party) ● Contract provided clause: in any dispute, the court in Torino in Italy will have exclusive jurisdiction ● When Italian company wants to sue HK, they thought HK court is more convenient as they have assets in HK ● Try to ignore EJC ● D: no defence, try to avoid EJC in favour of italy ○ EJC are only relevant when have dispute between parties ○ Then, if there is no real dispute, EJC does not apply Held: D argument not accepted in HK/UK/SG ● Not convincing to avoid the application of EJC ● Irrelevant whether D has any defence or not ● EJC is meant to cover every aspect of the contractual dispute Shanghai ● Lo Ka Lee High hurdle ● Both HK parties, contract to supply plastic knives and forks to airline ● EJC: Frankfurt in germany ● HK court upheld EJC even party try to argue that Covid was an unforeseeable event ○ Witness have to travel to Germany ● Not sufficiently strong reason of Covid to ignore EJC 91 Exceptional cases where HK court ignore EJC in the interest of justice SO RARE Ghossoub Deprivation of P protection under HK ordinance ● Minority SH in HK company claim for unfair prejudice as the company do not pay them dividends ● Natural claim: take company to court under s.724 CO ● EJC in favour of England ○ Under English law, the relevant law only applies to English registered companies ○ If court upheld EJC, effect of depriving HK SH minority protection under CO ● HK court: against public policy to uphold and EJC will be ignored Donohue v Armco** Multiple defendants some covered by EJC and some not ● Fraud case ○ All guilty of fraud or no one guilty of fraud ● D1 and D2 EJC England but D3 and D4, not subject to HK jurisdiction. ● New York court has the jurisdiction over all four defendants ● P intends to bring proceedings against all the Ds in New York which is an appropriate jurisdiction ● Does the HK court uphold the contractual intention of the parties or should it stay proceedings in favour of New York in the interests of justice thus avoiding parallel proceedings and the risk of inconsistent judgments in Hong Kong and New York? HL: example where on ground of justice, EJC will not be applied ● Judge has to look at D in cross-e very carefully ● Important judge can look at all 4 in witness box ● Collective decision on all 4 D ● Unfair situation where 2 of them found guilty and the remaining 2 acquitted if upheld EJC [No] Pacific Aerosupplies v Dakota Air Parts Intl Inc Party has broken EJC deliberately previously ● P buys helicopter parts from D ● Discovered D is going to break the agreement and sell to third party ● EJC: HK ● P went to South Dakota court and applied for interim injunction to stop sale of parts D 92 ● Wants to sue in HK now Held: not accepted as P broke EJC and commence proceedings elsewhere (b) Linked contract with inconsistent EJC situation ● Not strong reason for court to ignore EJC ● Situation: A(owner) ---- B (Main contractor) ---- C (subcontractor) ○ Defective service provided by C ○ A sues B ○ B sues C to indemnify the damages he has to pay A ○ Parallel proceeding S Net Freight (HK) LTD v Namsung Shipping Co LTD** Inconsistent with the normal approach below ● Carry of goods cases ● No JC in main contract ● Subcontract EJC is South Korea ● Case came to HK court, agreed on basic FNC principle that HK is the natural forum for the case ● EJC SK ignored ○ Does no make sense to have two litigation over the same matter ● Criticism: unreasonable that a no jurisdiction clause takes over EJC ○ Should have applied SK EJC Li Lian International Airport V Herport HK Ltd ● Problem: inconsistent EJC ● Main contract between owner and carrier: EJC is HK ● Contract between carrier and subcarrier: EJC is Tokyo ● P (owner) --- contract transport of goods with H (main carrier) ● H --- sub-contract with NYK (subcarrier) ● P sue H for damages ● H then sue NYK to indemnify the loss of suffer to pay P ● Herport claim against NYK was statute barred in Tokyo ○ Argue to apply HK EJC to both contracts Held: no as P is responsible for the situation he has agreed ● No interference of contract clauses ● Give effect to EJC agreed by parties 95 [2021] HKCFI 906 ● HK court held the clause as non-exclusive 3. Non-exclusive jurisdiction clause ● Noble Power case*** Geoffrey Ma judgement ● Party is free to bring the case in other jurisdiction ● Problem of NEJC: parallel proceedings ● Where party commences proceedings in HK and there is NEJC in favour of Mainland, the forum non conveniens will become relevant Chinachem Financial Services v Century Venture Holdings ● Contractual dispute ● Feb, D took the case to Mainland ● March, P started identical proceedings in HK ● D objected to P claim, claiming that P has no right to start parallel proceeding ● HK court: P has complete right to bring the claim in HK ○ NEJC agreed by parties ○ P is using his right in the contract Rich Village ● NEJC in favour of Nanjing ● P brought claim in HK ● Held: HK was forum conveniens despite there being NEJC in favour of NingBo ● Apply normal FNC test Patrick James ● Similar as above [EXAM TIP] if given JC and need to work out its legal effect - Give opinion on whether it is exclusive or not - Then, explain the legal consequence and also explain the opposite outcome → safety measures 96 LECTURE 10: ANTI-SUIT INJUNCTIONS ● Effect: applicant apply to court to stop foreign jurisdiction ● How ASI works: directed at D personally, not the foreign court ○ If party break the injunction, personal sanctions will be imposed on him such as fines or even jail → committing contempt of court ○ Interfering with foreign proceedings to stop the proceedings ● Note: only of use if D is in HK or he has assets in HK ● ASi is in breach of comity → judges are slow to grant ASI!! ● Lord Hoffman in Barclays Bank plc v Homan: ○ Foreign judges are usually the best person to decide whether to accept jurisdiction ● Exceptional remedy ● If party won a case in foreign country and wants to enforce the judgement, ASI can be used to stop the enforcement → seldom granted ○ Why so slow?? Could have applied for ASI when proceedings first begin ● HK will only grant ASI where it has interests in the dispute e.g. EJC in favour of HK ● Sequence: apply for ASI, then FNC Airbus v Patel** HL ● Plane crash in India ● P (a number of people injured) litigated in India against Indian Airline of pilot’s negligence ● Then started proceedings against Airbus (manufacturer inn France) in Texas ● Airbus applied for ASI England to stop Texan proceedings ○ But ASI only works if Airbus has assets in England ● HL: will not grant ASI ○ Absolutely no connection with England ● Lord Goff: it isn't the function of English court as an international placement Hin-Pro case** Example ● Begins in English court ● Contract of carriage of good between Mainland and Venezuela ● HP HK company ● EJC England 97 ● HP broke the clause 100 times, litigating against Venezuela company in other jurisdiction ● Court: contempt of court of HP, heavily fined ○ However, no real sanction as HP no assets in England How to stop HP? ● V applied in HK for Mareva injunction to freeze HP’s assets in HK IMPORTANT ● If ASI was sought against HP, the application would have failed ● Applying Airbus Industrie v Patel: HK did not have sufficient connection with the dispute ○ Not a natural or chosen forum to justify HK interference with Mainland proceedings 1. Ground to grant ASI ● Contractual ground (easy) ● Unconscionable ground (1)Contractual ground ● Exclusive jurisdiction clause in favour of HK in the contract -- court can justify the grant of ASI on the ground that party has breached the contract, avoid the problem of attacking foreign jurisdiction and show respect of comity ● Court expect party to act quickly to apply ASI ○ Delay will not grant Morgan Stanley v China Haisheng Juice Holdings Example of court granting ASI on EJC contractual ground ● Two entities made contract with China Juice ● MS contract with CJ, have EJC in favour of England ● Second contracting party MS Asia made contract with CJ, no EJC in agreement ● MS wants to enforce ASI relying on EJC in favour of England to stop any proceedings CJ in Mainland ○ CJ: if EJC is upheld, danger of parallel proceedings, sued by MS in England and MS Asia in China