Judgment

[Please note that this case has not been edited in accordance with the current Singapore Law Reports house style.]

Choo Han Teck JC:

1       The plaintiff is an insurance company incorporated in Singapore (People’s Insurance Co Ltd) and carrying on business as such. The defendant is a wholly owned subsidiary of Akai Electric Co. It distributes audio, video and other electronic equipment in Australia for its Tokyo based parent company.

2       In March 1991 the defendant’s insurance brokers, Credit Insurance (Brokers) Ltd (CIA) began negotiations with Global Trade Insurance Management Pte Ltd (GTI), a wholly owned subsidiary of the plaintiff, for a credit insurance policy to be issued by the plaintiff to the defendant.

3       The negotiations concluded with the issue of a “comprehensive credit policy” on 1 June 1991 by the plaintiff naming the defendant as the insured. The policy was issued from Singapore and the risks covered are set out in cl IA of the policy.

4       Sometime about November 1991, one of the defendant’s trade debtors failed to pay its debt and eventually went into liquidation in February 1992. Thereafter, the defendant made a claim on the policy. By letter dated 20 December 1992, GTI, on behalf of the plaintiff, rejected the claim, citing breaches of the terms of the policy.

5       On 5 March 1993 the defendant commenced proceedings in England and Australia simultaneously. The English action was not pursued, and the writ was not served on the plaintiff until 22 December 1993. In the meantime, the plaintiff had entered appearance in the Australian proceedings and applied successfully for a stay of the Australian proceedings. The stay order was made on 7 December 1993, a few weeks before the English writ was served on the plaintiff. The defendant appealed against the stay order but its appeal was dismissed. It then appealed to the High Court of Australia, and by a majority of three to two the High Court of Australia allowed the defendant’s appeal and directed that the action proceed to trial. As the defendant were taking steps to obtain directions as to the further conduct of the proceedings the plaintiff applied, ex parte, to the High Court in Singapore for an injunction (fashionably referred to as an ‘anti-suit’ injunction) against the defendant, prohibiting them from proceeding further in the Australian action. The application was granted and the defendant now applied to have the injunction discharged.

6       The basis for the plaintiff’s application for the injunction against the defendant was that cl 9 provided that the policy shall be governed by English law and that any dispute arising from the policy “shall be referred to the courts of England”. The plaintiff applied for the injunction in Singapore only because it fears that if the defendant is successful in the Australian suit it would seek to enforce the judgment against the plaintiff’s assets in Singapore.

7       The plaintiff’s application was an unusual one because normally, a party seeking an anti-suit injunction makes his application in one of the competing forums to restrain the other party from commencing or continuing an action in the other forums. In this case, Singapore was not a competing forum in the sense that neither party intended to litigate the matter here. The competition was between the English forum and the Australian forum. The plaintiff did not apply for an antisuit injunction in England. There is, however, a pending application by the plaintiff in the English court for summary judgment against the defendant, and the defendant has a pending application to strike out the plaintiff’s action.

8       Mr Lee, counsel for the defendant, raised various arguments before me. First, he submitted that the Singapore court had no jurisdiction to entertain the plaintiff. He argued that the plaintiff obtained leave to serve the writ out of jurisdiction on erroneous grounds, namely that the contract of insurance was made in Singapore. He challenged the plaintiff’s assertion that the letter of acceptance was sent to the plaintiff by telefax which was received in Singapore, thereby entitling the plaintiff to assert that the contract (and therefore the cause of action) arose in Singapore. I do not think that this is a valid objection as there is ostensible evidence that justified the issuance of the writ out of jurisdiction. If the defendant takes issue with that evidence it is at liberty to challenge it at trial.

9       Secondly, he submitted that the court had no jurisdiction because the defendant was not amenable to the jurisdiction of the court. It is true that the defendant does not have any presence or assets in Singapore, nor had it taken any steps in these proceedings other than opposing the injunction. It thus appears quite clearly that the defendant was not amenable to the jurisdiction of this court. It may be that at some future date it may appear to seek enforcement proceedings against the defendant but that day has not (and may not) come.

10     The Court of Appeal in Bank of America National Trust & Savings Association v Djoni Widjaya [1994] 2 SLR 816 approved the principles encapsulated by Lord Goff in Societe Nationale Industrielle Aerospatiale v Lee Kui Jak [1987] AC 871. These principles are, first, the court’s jurisdiction is to be exercised only where the ends of justice so requires. Secondly, if the court does exercise its jurisdiction to grant the injunction its order must be directed against the parties proceeding or threatening to proceed in the foreign court, and not against the foreign court itself. Thirdly, the party may be enjoined only if it is amenable to the jurisdiction of the court, and fourthly, the jurisdiction is one which must be exercised with caution since it will indirectly affect the foreign court.

11     In this case, the fact that the plaintiff had not applied for an order against the defendant in England is significant especially where it cannot be said that the defendant was not amenable to the English court since it had itself issued a writ against the plaintiff there.

12     Although the parties had agreed to refer disputes to the English court, one of them has now chosen to refer to the Australian court, which has accepted that it has jurisdiction and will adjudicate on the claim. It remains for the other party to seek an order from an English court as to whether they have a greater jurisdiction to try the dispute, or to leave that to be resolved in the Australian court. In these circumstances, the Singapore court should not assume the role of an international busybody and direct that the parties litigate in England when the English court may well decline to assume jurisdiction on the ground of forum non conveniens. The courts of the two competing jurisdictions are entitled to come to different conclusions, and that does not concern the Singapore courts unless the parties come to this jurisdiction for the purposes of enforcing their respective judgments, but that would be an entirely different matter.

13     Mr Alvin Yeo, counsel for the plaintiff referred to the case of Airbus Industrie GIE v Patel (unreported). This was a Court of Appeal decision from England. It was a case in which some English claimants were claiming damages arising from an air crash in India. The claimants sued in Brazoria County, Texas as well as in Bangalore, India. The proceedings in Texas were dismissed for want of jurisdiction by the Texan court, but there was a pending appeal against that decision. Airbus also commenced action in Bangalore claiming various reliefs against the English claimants, including an anti-suit injunction restraining the English claimants from suing in any other jurisdiction. The injunction was granted. Airbus then sought a similar order in the English courts. Coleman J at first instance refused the injunction sought, but the Court of Appeal reversed him. Mr Yeo argued that that case is good authority because it was a clear instance where a third country’s court had intervened in restraining a party involved in litigation in two other jurisdictions. I do not agree. The Court of Appeal itself acknowledged that that was an exceptional case. It was persuaded by the fact that the Texan court was not prepared, nor had the jurisdiction to decide on the question of forum non conveniens, and that the only court which had the jurisdiction and power to enforce that jurisdiction was England. That is clearly different from the present case. The Australian court had already ruled that it had jurisdiction and that the choice of jurisdiction clause was void. The English court, which was the parties’ choice court under the contract also has jurisdiction to consider the principles of forum non conveniens. Hence, where there are two courts both having jurisdiction a third court with tenuous connection should not influence the course unless there are strong reasons to do so. That one party may eventually seek to enforce a judgment there, is not a sufficiently strong reason.

14     For the reasons above, I discharged the injunction. The plaintiff’s counsel applied for a stay of the order pending appeal. I accept his submission that as there will be a hearing on 20 June 1997 in the Australian court, any participation by the plaintiff in that proceedings may prejudice their position and thereby probably render the appeal nugatory. That hearing does not relate to a challenge of the Australian court’s jurisdiction (that fight is over) but is in relation to directions for trial. On the balance of justice, there is less harm in granting a stay than in refusing it. I, therefore, ordered a stay pending the Plaintiff’s appeal.

Injunction discharged; stay of order pending appeal.

Reported by Chou Sean Yu