AFS Freight Management Pty Ltd & Anor v Ziegler Nederland BV [2000] QSC 489

SUPREME COURT OF QUEENSLAND CITATION: AFS Freight Management Pty Ltd and Anor v Ziegler Nederland BV [2000] QSC 489 PARTIES: AFS FREIGHT MANAGEMENT PTY LTD ACN 010 476 669 (first applicant) AFS PROJECTS AND LOGISTICS PTY LIMITED ACN 074 623 984 (second plaintiff) v ZIEGLER NEDERLAND BV (defendant) FILE NO/S: S1425/00 DIVISION: Trial Division DELIVERED ON: 22 December 2000 DELIVERED AT: Brisbane HEARING DATE: 30 August 2000 JUDGE: Douglas J ORDER: That the defendant’s application be dismissed with costs to be assessed on the ordinary basis. CATCHWORDS: PRIVATE INTERNATIONAL LAW – JURISDICTION – SUBMISSION TO JURISDICTION – APPEARANCE OR OTHER STEP BY DEFENDANT – whether foreign defendant submitted to the jurisdiction by filing a statutory demand and subsequently appearing in and contesting an application to set it aside – whether provisions of International Arbitration Act 1974 apply. International Arbitration Act 1974 Uniform Civil Procedure Rules, r 16 Boyle v Sacker (1888) 39 Ch D 249 Marlborough Harbour Board v Charter Travel Co Ltd (1989) 18 NSWLR 223 National Commercial Bank v Wimborne (1979) 11 NSWLR 156 Nudd v Taylor [2000] QSC 344 White v Hardwick (1922) 23 SR (NSW) 6 Williams v The Society of Lloyd’s [1994] 1 VR 274 COUNSEL: K A Barlow for applicant I R Perkins for respondent -- 1 of 4 -- 2 SOLICITORS: Flower & Hart for applicant Corrs Chambers Westgarth for respondent [1] DOUGLAS J: This is an application by the defendant pursuant to r 16 of the Uniform Civil Procedure Rules for an order that the plaintiff's claim be set aside or permanently stayed on the basis that this court has no jurisdiction to entertain the causes of action. [2] The first and second plaintiffs are companies incorporated in Australia that carry on a freight forwarding business. The defendant is a company incorporated in the Netherlands that carries on business as an international freight forwarder. [3] The plaintiff's claim arises out of an agreement between the second plaintiff and the defendant pursuant to which the defendant agreed to act as the second plaintiff's agent in Europe with respect to the provision of certain freight forwarding services. The agreement was partly oral and partly in writing. Insofar as it was in writing, it can be found in the correspondence exchanged between the parties both by post and by facsimile with one important area of contention, that being whether or not the Dutch forwarding conditions (FENEX) were part of the contract between the parties. [4] A dispute has arisen between the parties; the defendant has not received payment for services performed pursuant to the agreement, and the plaintiff alleges, inter alia, that invoices were inflated by the use of false foreign exchange rates, that the defendant overcharged certain consolidation and terminal handling charges, and that in some instances the defendant charged both the end-user and the second plaintiff for the same cost. [5] On 24 November 1999, the defendant served the first plaintiff with a Form 509H (Corporations Law) “Creditors Statutory Demand” claiming that the first plaintiff was indebted to it for freight forwarding services. An application was filed in this court to set aside that statutory demand on 17 December 1999. It was heard by Muir J on 27 January 2000 and, in allowing the application, his Honour ordered that: “the costs of and incidental to this application ... be reserved for determination in proceedings to be ommenced by the applicant against the respondent in respect of the subject matter of this application within 21 days of today's date unless otherwise ordered”. Pursuant to that the plaintiffs filed a claim on 17 February 2000 and the defendant filed a Conditional Notice of Intention to Defend on 26 April 2000. [6] The plaintiff now argues that the defendant in these proceedings has submitted to the jurisdiction of this court by its conduct in filing the statutory demand, and subsequently appearing in and contesting an application to set it aside. It is relevant to note that at no stage during those proceedings did the defendant raise objection to the jurisdiction of this court, nor in any way reserve its rights on the question. [7] It is clear that a party can only be taken to have submitted to the jurisdiction of the court in circumstances where its conduct is inconsistent with the maintenance of an -- 2 of 4 -- 3 objection to the court’s jurisdiction. It must be shown that the party alleged to have waived the objection to jurisdiction has taken some step, which is only necessary or useful, if the objection has been actually waived. See National Commercial Bank v Wimborne (1979) 11 NSWLR 156. Failure to object at first opportunity does not amount to submission. [8] For example, filing affidavits and contesting the merits of a case, even though an appearance has not been entered, will constitute submission. See Boyle v Sacker (1888) 39 Ch D 249. However in Williams v The Society of Lloyd’s [1994] 1 VR 274, McDonald J considered that a formal request by the defendants of the plaintiff for further and better particulars of the statement of claim did not amount to submission. [9] A defendant is also taken to have submitted to the jurisdiction of the court where before entering an appearance, it seeks interlocutory relief which is only consistent with an intention to contest the merits of the case. See White v Hardwick (1922) 23 SR (NSW) 6. Similarly, a foreign litigant who institutes proceedings as a plaintiff is taken to have submitted to the jurisdiction of the court to entertain any defence by way of cross-claim against him. The fact that the cross-claim involves a different cause of action from that which the foreign plaintiff has brought does not preclude it from being raised if the cross-claim is founded on or directly arises out of the same subject matter as that of the initial action. See Marlborough Harbour Board v Charter Travel Co Ltd 18 NSWLR 223. But the plaintiff is not taken to have submitted to claims outside of and independent of the subject matter of the initial action. See National Commercial Bank v Wimborne (supra). [10] This principle was approved recently in Nudd v Taylor [2000] QSC 344 where Holmes J said in determining that a foreign litigant had submitted himself to this jurisdiction: [21] “It is too broad a statement to say that a foreign plaintiff who proceeds in Queensland thereby submits himself to the court’s jurisdiction at large. The position, is, in my respect view, correctly stated by Holland J in National Commercial Bank v Wimborne 35: “a foreign plaintiff, not otherwise subject to the jurisdiction of the court, who brings an action in the Court submits himself by necessary implication to every matter of counter-claim that would operate as a defence to his action or that would as a set off or cross claim arising out of the same subject matter reduce or extinguish the plaintiffs’ claim; and also, at least if he is not a foreign Sovereign, to a counterclaim founded on or directly arising out of the same subject matter as the plaintiffs’ claim that would require to be tried in order to do justice between the parties in relation to that subject matter even if it might result in a judgment against the plaintiff on the counterclaim.” His Honour continued, “To what has the plaintiff submitted? The answer to that lies, I think, in a consideration of what the plaintiff has brought to the -- 3 of 4 -- 4 Court for adjudication. He could not, in my opinion, properly be said to have submitted to claims outside of and independent of the subject matter of his own action”. 36 [22] That case was cited with approval by the New South Wales Court of Appeal in Marlborough Harbour Board v Charter Travel Co Ltd 37. In the latter case, the court was prepared to go somewhat further, deciding that the foreign plaintiff’s submission to the jurisdiction extended to a counterclaim which raised a new cause of action, provided that such a cross-claim was founded on or directly arose out of the same subject matter as that of the action. [23] To similar effect, the English Court of Appeal in Republic of Liberia v Gulf Oceanic 38 concluded that a plaintiff submitted himself to the incidents of his litigation, including liability to a counterclaim properly brought. In that case the plaintiffs had sought a declaration in relation to a contract for the purchase of oil and a resulting arbitration. The defendant’s counterclaim for damages for breach of the same contract and tort for wrongful procuring of the breach was permitted to stand, notwithstanding that the foreign defendants could not, in the absence of their own litigation, have been made amenable to the jurisdiction of the court on such an action.” [11] In my view the defendants in this case have by their conduct submitted themselves to the jurisdiction of this court. [12] A further matter arises in relation to the general conditions of FENEX referred to above. Article 22 of the FENEX provides in effect the place for settlement and adjustment of the damage shall be Holland. [13] However, as it was submitted, the uncontested evidence establishes that: (a) there was never any such agreement between the parties and hence there is no agreement as alleged by the defendant as to the jurisdiction in which dispute shall be determined, or that disputes will be arbitrated. (b) even if there were, that agreement was in relation to earlier agreements and is on its face unsuitable for the project the subject of the claim in these proceedings; (c) the contracts arguably incorporated terms they would be governed by Australian law within the jurisdiction of Australian courts; and (d) paragraph 22 of Bell’s affidavit of 28 August 2000. [14] In my view therefore the provisions of the International Arbitration Act 1974 do not apply nor is the jurisdiction of the court ousted by any alleged agreement between the parties. [15] In the result I order that the defendant’s application be dismissed with costs to be assessed on the ordinary basis. -- 4 of 4 --