Giant Light Metal Technology (Kunshan) Co Ltd v Aksa Far East Pte Ltd

Andrew Ang J:

[1] This was an action concerning the recognition and enforcement at common law of a foreign judgment obtained from the Suzhou Intermediate Court, Jiangsu Province, in the People’s Republic of China (“the PRC Court”). In particular, the case raised novel issues as to when a foreign court is said to have international jurisdiction and how a foreign judgment is enforced by the Singapore courts under Singapore private international law.

[2] On 16 December 2010, Giant Light Metal Technology (Kunshan) Co Ltd (“the Plaintiff”) successfully obtained judgment against Aksa Far East Pte Ltd (“the Defendant”) in the PRC Court for breach of contract (“the PRC Judgment”). The Plaintiff then sought to enforce against the Defendant in Singapore the PRC Judgment for the payment of various sums of moneys.

[3] The Plaintiff is a company incorporated in the People’s Republic of China (“the PRC”) and is engaged in designing and producing aluminium and alloy materials for the purposes of industrial and commercial use.

[4] The Defendant is a company incorporated in Singapore and is in the business of general wholesale trade, including general import and export of goods.

[5] On or around 18 December 2003, the parties entered into a contract for the Plaintiff to purchase from the Defendant two new generator sets with new engines, which were to be manufactured by the Cummins Engine Company Inc in England, United Kingdom (“the Contract”). The total purchase price of the generator sets was US$200,000 of which the Plaintiff paid US$190,000.

[6] A further party to the Contract was Shanghai Yates Genset Co Ltd (“Shanghai Yates”), a company incorporated in the PRC which acted as guarantor for the Defendant in the purchase of the generator sets. Shanghai Yates was a sub-distributor of the Defendant in the PRC at the relevant time.

[7] After receiving the generator sets from the Defendant, the Plaintiff was not satisfied with them: they were not new generator sets nor manufactured in England and were not capable of use. The Plaintiff thereafter instituted a civil claim against the Defendant and Shanghai Yates for breach of the Contract in the PRC Court on 25 July 2005 (“the 2005 Proceedings”). The Defendant responded by filing a “Statement of Defence” and also sent its representative, Mr You Tian Fen (“Mr You”), to attend court hearings. Subsequently, the 2005 Proceedings were discontinued on 10 September 2007 “to enable parties to attempt to resolve the matter”.

[8] In the event, the out-of-court negotiations failed. On 9 May 2008, the Plaintiff re-commenced proceedings for the same claim against the Defendant and Shanghai Yates in the PRC Court (“the 2008 Proceedings”). The relevant court documents were served on the Defendant in Singapore at the Defendant’s registered office address via diplomatic channels on 6 November 2008. The Defendant did not dispute that it was properly served. The Defendant, however, chose to ignore the 2008 Proceedings and did not enter an appearance, taking no part in the proceedings.

[9] Shanghai Yates on its part filed two defences to the Plaintiff’s claim in the 2008 Proceedings and attended hearings in the PRC Court on 17 April 2009 and 20 October 2010. The PRC Court heard submissions by representatives of the Plaintiff and Shanghai Yates and, upon further consideration, awarded judgment in favour of the Plaintiff in the PRC Judgment. The section of the PRC Judgment which sets out the orders made is reproduced as follows:

[10] The PRC Judgment was served on the Defendant at its registered office in Singapore on 25 March 2011 through diplomatic channels, and the deadline within which the Defendant could have brought an appeal to the Jiangsu Higher Court expired on 25 April 2011.

[11] The generator sets were thereafter not collected by the Defendant. Neither did it pay the judgment sums ordered to be paid to the Plaintiff. This was despite a letter of demand sent by the Plaintiff to the Defendant on 22 July 2011. It appeared that the Defendant was not interested in collecting the generator sets despite the Plaintiff being ready and willing for the Defendant to do so. A director of the Defendant, Ms Yong Yit Yeng Mavis, even went so far as to say in cross-examination that she was not interested in taking the generator sets back and would rather dispose of the generator sets in the PRC.

[12] As a result of the Defendant’s non-compliance with the PRC Judgment, the Plaintiff, on 10 February 2012, commenced the present action in Singapore, claiming, inter alia:

(a) the sums of US$190,000 and RMB7,088 as ordered in the PRC Judgment (“the PRC Judgment Sums”);

(b) the Defendant’s PRC court fees ordered under the PRC Judgment of RMB14,626 which had been paid by the Plaintiff (“the PRC Court Fees”);

(c) interest on the PRC Judgment Sums and the PRC Court Fees; and

(d) costs.

[13] Counsel for the parties submitted that the present case concerned the common law rules on recognition and enforcement of a foreign judgment, and brought to the court’s attention the paucity of Singapore case law in this area. In particular, the parties highlighted to the court the lack of precedent in relation to the issues which arose directly for decision before me. As a result, parties relied (as a starting point) on the principles as stated in Dicey, Morris and Collins on The Conflict of Laws (Lord Lawrence Collins gen ed) (Sweet & Maxwell, 15th Ed, 2012) (“Dicey, Morris and Collins”) at vol 1, paras 14R-020 and 14R-054:

[14] Indeed, there does not appear to have been an occasion when a Singapore court was required to deal with the same scope of issues relating to the recognition and enforcement of a foreign judgment under the common law as in the present case. However, the common law rules in the other major common law jurisdictions on these issues are well established. Therefore, I accepted that the principles as stated in Dicey, Morris and Collins served as an appropriate starting point for analysis of the issues that arose. I also noted that Professor Yeo Tiong Min in Halsbury’s Laws of Singapore – Conflict of Laws vol 6(2) (LexisNexis, 2009) (“Yeo”) also referred to case law from England (and other common law jurisdictions) and used the English position as the basis for his analysis of this area of Singapore private international law (see generally paras 75.155–75.240).

[15] In order to make clear the framework for analysis of the issues in the present case, it is apposite that I draw attention to an important distinction between the recognition of a judgment and its enforcement, as summarised by Professor Adrian Briggs (“Prof Briggs”), in Adrian Briggs, The Conflict of Laws, (OUP, 2nd Ed, 2008) (“The Conflict of Laws”) at pp 119–120:

[16] This distinction was not made clear in the present case since the Plaintiff sought only the enforcement of the PRC Judgment and did not expressly indicate that the PRC Judgment should be recognised. However, I found that it must follow, as a matter of logic and principle, that the PRC Judgment be recognised before it can be enforced. In the words of Prof Briggs, quoted by Lord Rodger of Earlsferry in Clarke v Fennoscandia Ltd [2007] UKHL 56 at [21], “the logic of the law is that recognition is the necessary primary concern”.

[17] What determines whether a foreign judgment is capable of recognition and enforcement according to the common law rules of private international law is broadly stated in Dicey, Morris & Collins, para 14R-020 (“Rule 42”) ([13] supra). However, a short summary of these requirements can be found in The Conflict of Laws (at pp 136 and 149) which I reproduce as follows:

[18] Parties made their submissions based on these general requirements, and were agreed on what were the issues necessary for me to decide the case. Importantly, the Defendant did not raise any objection that the PRC Judgment was not final and conclusive on its merits, allege any impropriety on the part of the Plaintiff in the PRC Court when obtaining judgment in their favour, nor raise any other defences to recognition and enforcement of the PRC Judgment.

[19] Accordingly, the issues in determining whether the PRC Judgment should be recognised and enforced under the common law rules of Singapore private international law were as follows:

(a) Whether the PRC Court had international jurisdiction over the Defendant for the purposes of recognition and enforcement of the PRC Judgment (“Issue 1”).

(b) Whether the Plaintiff’s claim satisfied the requirement that only foreign judgments for a definite sum of money are enforceable (“Issue 2”).

[20] It is widely accepted that in deciding the issue of international jurisdiction, the common law is generally not concerned with how the foreign court had assumed jurisdiction over the party under its own laws (see Buchanan v Rucker (1808) 9 East 192 at 194; 103 ER 456 at 457). Instead, as stated by Prof Yeo in Yeo (at para 75.170):

Therefore, whether the PRC Court had international jurisdiction over the Defendant was to be determined by Singapore private international law.

[21] In general, Dicey, Morris & Collins at para 14R-054 (“Rule 43”) (see above at [13]) sets out four situations where a foreign court can be said to have international jurisdiction over a party such that a judgment in personam issued by that court may be recognised and enforced in the Singapore courts. Counsel for the Plaintiff, Ms Rebecca Chew (“Ms Chew”) relied on two of these situations: (a) the Defendant had voluntarily submitted to the PRC Court at the relevant time (the first situation in Rule 43); and (b) the Defendant was present in the PRC at the material time (the third situation in Rule 43). Ms Chew then made two further submissions in the alternative. The first was that Shanghai Yates was the Defendant’s privy for the purposes of submission to the PRC Court or presence in the PRC and, secondly, that the “real and substantial connection” approach adopted by the Canadian Supreme Court in Beals v Saldanha [2003] 3 SCR 416 should be applied in Singapore, the PRC having a real and substantial connection to the dispute between the parties.

[22] Ms Chew also submitted, rightly, that if I were to find for the Plaintiff on just one of the above mentioned grounds that would be sufficient to establish that the PRC Court had international jurisdiction over the Defendant. Counsel for the Defendant, Mr Francis Goh (“Mr Goh”), agreed with this submission and accordingly resisted each ground.

[23] The case for finding that a foreign court has international jurisdiction over the defendant based on voluntary submission, as explained in Dicey, Morris & Collins (at para 14-069), “rests on the simple and universally admitted principle that a litigant who has voluntarily submitted himself to the jurisdiction of a court by appearing before it cannot afterwards dispute its jurisdiction”. The question then is: what constitutes voluntary submission to the foreign court for the purpose of international jurisdiction?

[24] In WSG Nimbus Pte Ltd v Board of Control for Cricket in Sri Lanka [2002] 1 SLR(R) 1088 at [54], Lee Seiu Kin JC held that what must be considered is whether the party “had taken a step in the proceedings which necessarily involved waiving their objection to the jurisdiction”. The learned authors in Jonathan Hill and Adeline Chong, International Commercial Disputes: Commercial Conflict of Laws in English Courts (Hart Publishing, 2010) (“Hill & Chong”), further elaborate on what constitutes taking “a step in the proceedings” (at para 12.2.5):

[25] Consistent with the general principle that whether a foreign court has international jurisdiction depends on the private international law rules of the forum and not the law of the foreign court, whether a party has voluntarily submitted to the foreign court is a question for Singapore private international law rules. This was stated unequivocally in the recent United Kingdom Supreme Court decision of Rubin and another v Eurofinance SA and others [2013] 1 AC 236, where Lord Collins of Mapesbury observed (at [161]) thus:

[26] Importantly, Lord Collins qualifies the oft-cited proposition found in Adams and others v Cape Industries Plc and another [1990] Ch 433 (“Adams v Cape”) (per Scott J at 461) that the fact that the foreign court considers there to have been a submission is a necessary, but not a sufficient, condition for the foreign court to have international jurisdiction. Instead, Lord Collins preferred the more nuanced approach taken in deciding whether there was submission for the purposes of international jurisdiction, and further reinforced this view by citing with approval the view of Thomas J in Akai Pty Ltd v People’s Insurance Co Ltd [1998] 1 Lloyd’s Rep 90 at 97:

[27] This was also the approach Ms Chew suggested I take in deciding the matter, and I agreed. On that basis, Ms Chew submitted to the court that it was clear that the Defendant by entering a defence had submitted to the jurisdiction of the PRC Court in the 2005 Proceedings. It was apparent to me that no other conclusion could be drawn, and Mr Goh rightly accepted this to be the case as well. As mentioned above, however, the 2005 Proceedings were discontinued in 2007 for the purposes of out-of court negotiations, and later re-commenced as a fresh set of proceedings (viz, the 2008 Proceedings). The Defendant then ignored the 2008 Proceedings without even appearing in the PRC Court to raise a jurisdictional objection. Ms Chew submitted that the Defendant had nevertheless submitted to the PRC Court in relation to the 2008 Proceedings.

[28] The submissions by both parties necessitated a careful analysis of a number of issues:

(a) first, what was the basis for the PRC Court’s jurisdiction over the proceedings brought by the Plaintiff;

(b) secondly, whether the 2005 Proceedings and the 2008 Proceedings can be seen as one unit of litigation or a contiguous whole; and

(c) thirdly, whether consent to the jurisdiction of the PRC Court in the 2005 Proceedings should be imputed to the Defendant in the 2008 Proceedings.

I will deal with each of these issues in turn.

[29] This was obviously a question relating to PRC civil procedure and jurisdiction rules, and required the aid of PRC legal experts. A joint expert report for this purpose was filed by Mr Tang Linfeng (“Mr Tang”), the expert witness on behalf of the Plaintiff, and Mr Hua Yin (“Mr Hua”), the expert witness on behalf of the Defendant. Both PRC legal experts were also cross-examined in court via the “hot-tubbing” procedure.

[30] Significantly, Mr Tang and Mr Hua (especially after cross-examination) did not give vastly different legal opinions. Both experts agreed that the 2005 Proceedings and the 2008 Proceedings were technically different proceedings with different case numbers. Mr Tang, however, sought to downplay the significance of this.

[31] Mr Tang opined that given the submission by the Defendant to the jurisdiction of the PRC Court in the 2005 Proceedings, its subsequent failure to object to the jurisdiction of the same court in respect of the same claim after having been served with the relevant court documents amounted to an acceptance of the PRC Court’s jurisdiction. Unsurprisingly, Mr Hua did not agree. Mr Hua took the position that under Art 243 of the Civil Procedure Law of the People’s Republic of China (2007) (“CPL 2007”) (“Art 243”), there were two conditions which had to be fulfilled before a party is deemed to have accepted the jurisdiction of a PRC Court, viz, that (a) the party does not raise an objection to the court’s jurisdiction; and (b) a defence is filed with the court. Art 243 states that:

[32] Mr Hua gave further evidence that it was incumbent on a defendant to raise his objection to the adjudicating court in the PRC if it took issue with the jurisdiction of that court, but reiterated that no defence was filed in the 2008 Proceedings by the Defendant. On a plain reading of Art 243, it appeared to me that Mr Hua’s evidence on this matter was more persuasive on the issue of whether the Defendant had accepted the jurisdiction of the PRC Court. That was, however, not the end of the matter.

[33] Mr Tang gave further evidence that the PRC Court in both the 2005 Proceedings and the 2008 Proceedings would have taken jurisdiction over the matter under Art 241 of the CPL 2007 (“Art 241”) and would not have had to refer to Art 243 at all. Art 241 states that:

[35] The experts also gave evidence that the PRC Court would investigate on its own motion whether they had jurisdiction over any particular matter. This was supported by the fact that the PRC Court issued a Notice of Case Acceptance dated 12 May 2008, which indicated that they would be accepting the case as they had “conducted [their] examination and found [that the case] had met the acceptance conditions stipulated in the ‘Civil Procedure Law of the People’s Republic of China’”, notwithstanding that the Defendant had clearly not filed a defence in the 2008 Proceedings.

[36] Therefore, I accepted the evidence by Mr Tang that Art 243 was not actually applicable to either the 2005 Proceedings or the 2008 Proceedings. Whether the Defendant had voluntarily accepted the PRC Court’s jurisdiction under PRC law was not relevant to the PRC Court’s determination that it had jurisdiction over the proceedings brought by the Plaintiff. It was also clear that the experts were agreed that the PRC Court had properly taken jurisdiction over the 2008 Proceedings under its own laws.

[37] Ms Chew submitted that taking an objective assessment of all the facts, including how the PRC Court took jurisdiction over the 2005 Proceedings and the 2008 Proceedings, the Defendant’s failure to appear in the 2008 Proceedings must be viewed in conjunction with its voluntary submission to the 2005 Proceedings. Ms Chew took the position that although the 2005 Proceedings and 2008 Proceedings were technically two separate proceedings, for the purposes of submission to jurisdiction they had to be viewed as a contiguous whole. This would mean that the submission by the Defendant to the PRC Court in the 2005 Proceedings would constitute submission in the 2008 Proceedings as well. The heart of this argument was that the 2005 Proceedings and the 2008 Proceedings were separate proceedings only as the result of a mere technicality; the Defendant had conducted itself in such a way that it had clearly consented to the jurisdiction of the PRC Court, and allowing the Defendant to deny its payment obligations under the PRC Judgment would go against any reasonable conception of fairness.

[38] Mr Goh, on the other hand, maintained that the 2005 Proceedings and the 2008 Proceedings were separate proceedings that could not be viewed as “one unit of litigation” or treated as a contiguous whole. If I agreed with Mr Goh on this point, then Ms Chew’s submission would not get off the ground.

[39] In support of his objection, Mr Goh relied on the seminal English case on international jurisdiction of Adams v Cape. Adams v Cape involved a situation where Cape and Capasco, both English companies, presided over a group of subsidiaries engaged in the mining of asbestos in South Africa and the marketing of the mined asbestos. The mined asbestos was sold for use in a factory in Texas where its employees later suffered personal injury from exposure to asbestos dust. In 1974, 462 workers commenced proceedings against a number of companies, including Cape and Capasco, in Tyler, Texas (“the Tyler 1 Action”). Cape and Capasco protested the jurisdiction of the Tyler court. Those proceedings were eventually settled after the parties entered into a consent order where the workers were paid a sum of money by the defendants. Subsequently, another 206 workers instituted legal proceedings in the same court against the same defendants (“the Tyler 2 Action”). This time, Cape and Capasco chose to ignore the proceedings; they had by then removed their assets from the jurisdiction. The plaintiffs in the Tyler 2 Action, as a result, obtained default judgment against Cape and Capasco and sought its enforcement in England.

[40] Before the English court, the plaintiffs sought to argue that the Tyler 1 Action and the Tyler 2 Action involved the same defendants and the same subject matter, and should be viewed as “one unit of litigation”, despite there being different plaintiffs in both actions. The purpose of this was so that the submission to the Tyler court by Cape and Capasco in the Tyler 1 Action could constitute submission to the Tyler court in the Tyler 2 Action. Scott J rejected this argument, and held (at 462–463) that:

[41] The reasoning of the judge is of particular import. First, Scott J focused on the lack of consent to the jurisdiction of the Tyler court by Cape and Capasco even in the Tyler 1 Action. Cape and Capasco had consistently objected to the jurisdiction of the Tyler court. It was only for the purposes of recording a consent order that Cape and Capasco entered an appearance in the Tyler 1 Action. Secondly, by extension, this meant that Cape and Capasco could not be taken to consent to the jurisdiction of the Tyler court in relation to any future proceedings which were not yet started regardless of the similarity of such proceedings with the Tyler 1 Action. Thirdly, the judge found that it would be “grossly unfair” to Cape and Capasco if consent to the jurisdiction of the Tyler court in the Tyler 2 Action was imputed to them merely because they were parties to a consent order in the Tyler 1 Action while maintaining their objection to the jurisdiction of the Tyler court at all times. Therefore, Scott J dismissed the “one unit of litigation” argument essentially because he found that Cape and Capasco had never properly consented to the jurisdiction of the Tyler court even in the earlier proceedings.

[42] Such was not the case before me. The subsequent proceedings did not just involve the same claims and the same defendants; even the plaintiffs were identical. Leaving aside the indistinguishability between the 2005 Proceedings and the 2008 Proceedings, the Defendant by filing its defence had unequivocally consented to the jurisdiction of the PRC Court in the 2005 Proceedings. Therefore, if the Defendant’s acceptance of the jurisdiction of the PRC Court in the 2005 Proceedings was indeed imputed to it in relation to the 2008 Proceedings, it would not “divorce a submission to the jurisdiction from the bedrock of consent that ought to underlie it” as would have been the case in Adams v Cape.

[43] Therefore, I could not agree with Mr Goh on this issue. There was an earlier consent by the Defendant to the jurisdiction of the PRC Court such that it was possible for such consent to be imputed to the Defendant in respect of the later proceedings (ie, that the two sets of the proceedings could be seen as one unit of litigation or a contiguous whole). Whether such consent should be imputed, however, is a separate issue, and it is to this issue which I now turn.

Whether consent to the jurisdiction of the PRC Court in the 2005 Proceedings should be imputed to the Defendant in the 2008 Proceedings

[44] Submitting in favour of an affirmative answer to the question, Ms Chew cited the English Court of Appeal decision in Murthy and another v Sivajothi and others [1999] 1 WLR 467 (“Murthy”). In Murthy, the plaintiffs who were resident in Florida were induced by the first defendant to transfer large sums of money to him purportedly for the purpose of establishing a trust fund for the plaintiffs’ children. The plaintiffs also agreed to convey two properties to the first defendant for use as collateral on a loan to finance the first defendant’s alleged business venture. The first defendant then mortgaged the properties to a third party who later brought proceedings in Florida for foreclosure against the plaintiffs, the first defendant and the first defendant’s company. The parties to the proceedings then entered into a stipulation for settlement agreement, which was a document drawn up to settle or stay the foreclosure proceedings. The plaintiffs subsequently advanced in the same proceedings, claims to set aside the stipulation for settlement agreement, and cross-claims against the first defendant for having fraudulently deprived the plaintiffs of their properties and moneys. The plaintiffs obtained judgment in default against the first defendant in respect of those cross-claims, and then sought to enforce the judgment in England. The first defendant argued in England that when he submitted to the jurisdiction of the Florida court, it was only in relation to the mortgagee’s foreclosure action and not to the cross-claims made by the plaintiffs against him.

[45] Disagreeing with the first defendant, Evans LJ (at 476E) held that:

The other judges agreed with the approach adopted by Evans LJ and concluded that the submission in the foreclosure action could extend to the cross-claims advanced by the plaintiffs against the defendant, since those claims were “related claims”. This was so even though the initial claim was by a mortgagee for foreclosure while the cross-claims were based on fraud with respect to both the moneys transferred to the defendant and the two mortgaged properties. Evans LJ further held (at 477D) that:

[47] In Aeroflot, Justice Floyd held that based on the principle in Murthy, it was “realistically arguable” that a judgment obtained in Russia against the defendant to uplift or index the amount of damages awarded under an earlier Russian judgment to account for inflation could be a related claim. Therefore, the defendant in submitting to the jurisdiction of the Russian court for the earlier claim could be taken to have submitted to the later indexation proceedings.

[48] Underlying all three of these cases is the principle that the courts are willing to recognise, for the purposes of international jurisdiction, that a party’s consent to the jurisdiction of a foreign court in relation to certain claims may be imputed to further claims in some circumstances. Prof Briggs in a case commentary on Murthy in Adrian Briggs, “B: Private International Law” (1998) 69 BYIL 332 at 352, suggested that “the effect of a submission in Murthy was that it amounted to an inchoate submission to other claims, reasonably closely related to that one commenced by the writ”. Such “inchoate submission” – as seen in Whyte and Aeroflot – is also possible in relation to claims which are brought pursuant to subsequent and separate proceedings in respect of the same parties, rather than just to claims which are part of the same proceedings.

[49] The question then is when consent will be imputed or “inchoate submission” be said to arise. Murthy provided two factual reference points for consent to be so imputed: where the subsequent claim concerns the same subject matter; and where the subsequent claim is related to the original claim. Which subsequent claims will fall under these categories is then a matter of degree based on the circumstances. The courts in making this assessment seemed to be informed by concerns of fairness to both the plaintiff and the defendant, and also a desire to disregard technical impediments created by procedural rules under both foreign and forum law. With respect, I agree with such an approach.

[50] In my view, the present case was one that warranted a finding of inchoate submission by the Defendant to the 2008 Proceedings. The Defendant had consented to the jurisdiction of the PRC Court in the 2005 Proceedings. There was then a break in the proceedings due to the Plaintiff’s attempt to resolve the matter out-of-court. Mr Tan Chian Huat, a director of the Defendant at the material time, gave evidence that he was relieved at this development; he was thankful that the case was withdrawn because he believed that the Plaintiff would have succeeded in its claim in the PRC Court. When the proceedings were restarted in 2008 by the same plaintiff against the same defendant for the same claim in the same court, the later proceedings were separate from the 2005 Proceedings only because of a technicality. The Defendant then sought to exploit this procedural technicality by ignoring the 2008 Proceedings based on legal advice that any judgment awarded in such circumstances would not be enforceable in Singapore. To bring home the point, if the 2005 Proceedings were stayed rather than withdrawn, there would have been no dispute at all that the Defendant had accepted the jurisdiction of the PRC Court.

[51] I found that although the facts of the present case were different from Murthy, Whyte, and Aeroflot – the subsequent proceedings were exactly the same as the earlier proceedings, and the earlier proceedings did not finally dispose of the parties’ rights – this was one instance where consent to the jurisdiction of the PRC Court by the Defendant should properly be imputed. To my mind, there was no unfairness to the Defendant in imputing such consent. Per contra, there would be unfairness to the Plaintiff were the Defendant allowed to take advantage of abortive out-of-court negotiations to escape liability for its wrongdoing.

[52] Therefore, I found that the Defendant had voluntarily submitted to the jurisdiction of the PRC Court in the 2008 Proceedings and, accordingly, the PRC Judgment was a judgment of a court that had international jurisdiction for the purposes of recognition and enforcement.

[53] Since international jurisdiction may be established on alternative grounds and having found that the Defendant had voluntarily submitted to the jurisdiction of the PRC Court for the purposes of recognition and enforcement of the PRC Judgment, I did not consider further the other grounds for international jurisdiction raised by the Plaintiff.

[54] At this juncture, the Plaintiff had satisfied all the necessary requirements for the PRC Judgment to be recognised in Singapore. The only question then was whether this PRC Judgment should be enforced in Singapore. This question is the subject of the analysis of Issue 2 below.

[55] Mr Goh submitted that the “law is clear that an enforceable foreign judgment must be a pure money judgment”. He pointed out that the PRC Judgment was for the rescission of the Contract and consisted in the main of two obligations: the return of the generator sets by the Plaintiff and the refund of the purchase price by the Defendant. He maintained that the two obligations flowed from the rescission of the Contract and “[could not] be separated”, with the result that the PRC Judgment was not a judgment for a definite sum of money and was unenforceable in Singapore.

[56] In support of his submission, Mr Goh relied on the Court of Appeal’s decision in Poh Soon Kiat v Desert Palace Inc (trading as Caesars Palace) [2010] 1 SLR 1129 (“Poh Soon Kiat”). That case concerned the recovery of a foreign gambling debt owed by the defendant to the plaintiff. Summary judgment was sought by the plaintiff in Singapore based on a foreign judgment obtained in the Superior Court of the State of California for the County of Santa Clara which set aside a fraudulent transfer of the defendant’s interest in a particular property while ordering that the property be sold and the proceeds applied to satisfy judgment debts arising from an earlier judgment of the same Californian court for the gambling debts owed. The Court of Appeal allowed the defendant’s appeal on a number of grounds, in particular that the Californian judgment sought to be enforced in Singapore was not for a definite sum of money but was for the setting aside of a fraudulent transfer of property instead.

[57] Ms Chew did not seek to challenge the requirement that only foreign judgments for a definite sum of money are enforceable as applied in Poh Soon Kiat and, understandably so, as this court is bound by that decision in any case. Instead, Ms Chew disagreed with the Defendant’s characterisation of the PRC Judgment. She submitted that the judgment merely entailed two separate obligations which the parties had to satisfy and that the Defendant was still liable to pay the Plaintiff the PRC Judgment Sums even though the Defendant was not in possession of the generator sets. Importantly, Ms Chew clarified that the real issue was whether “the Defendant [was] somehow absolved from performance of its obligation to make payment under the PRC Judgment”. In that regard, Ms Chew submitted that that could not be the case and that there was “nothing preventing this Court from ordering that the Defendant [perform its obligation to make payment under the PRC Judgment],” the Defendant’s obligation to pay the Judgment Sums not being contingent on the Defendant having received the generator sets. Ms Chew maintained that the enforcement action (by way of a debt claim) did not fall foul of the requirement that only judgments for a definite sum of money are enforceable.

[58] The submissions by both parties raised the following issues for consideration:

(a) The conceptual basis for the enforcement of foreign judgments in Singapore.

(b) Whether the Defendant’s obligation to pay the Plaintiff the PRC Judgment Sums could be enforced, given that the generator sets were still in the Plaintiff’s possession.

(c) Whether the Plaintiff’s claim was precluded because the PRC Judgment comprised other obligations which were not for a definite sum of money.

[59] A foreign judgment has no direct operation in Singapore and cannot be enforced immediately without more in the Singapore courts by way of execution. This accords with the common law. As explained in Dicey, Morris & Collins at para 14-002, “[t]his follows from the circumstance that the operation of legal systems is, in general, territorially circumscribed”. The process by which a foreign judgment is recognised and enforced was explained by Prof Briggs in Adrian Briggs, “Recognition of foreign judgments: a matter of obligation” (2013) 129 LQR 87 (“Briggs”) at pp 88–89 (albeit in the context of recognition and enforcement of foreign judgments in England):

[60] The present proceedings were instituted on this very basis; the PRC Judgment per se did not afford the Plaintiff any direct rights against the Defendant in Singapore. In that sense, it is indeed a misnomer – as suggested by Prof Briggs in Briggs at p 87 – that the common law is said to allow for the enforcement of foreign judgments. Any judgment enforced in Singapore (under the common law) is ultimately one given by the Singapore courts. The foreign judgment merely “prepare[s] the ground for the making of a local order” (see Briggs at p 89).

[61] Whether a particular foreign judgment is given legal effect in Singapore is then based upon the rules for recognition and enforcement under the common law as established earlier. Importantly, as long as the requirements for recognition and enforcement are met, the validity of the foreign judgment will not be scrutinised. The court will not re-examine the merits of the underlying claim in the foreign judgment (see the English case of Godard v Gray (1870-71) LR 6 QB 139 and the Straits Settlement Court of Appeal decision in Ralli and another v Anguilla [1915–23] XV SSLR 33; Lawnet neutral citation [1917] SSLR 2). This is commonly attributed to the theory that where a judgment is issued by a court of competent jurisdiction over the parties, that judgment creates an obligation on the parties to abide by it which the courts of other countries ought to recognise and enforce (see generally: Dicey, Morris & Collins at paras 14-007 and 14-008; The Conflict of Laws at p 136; and Hill & Chong at para 12.1.2). Therefore, the Singapore courts in recognising and enforcing a foreign judgment are holding the parties to their obligation to abide by the foreign judgment, and nothing more.

[62] Specific to the common law action to enforce a foreign judgment, where that judgment is entitled to recognition, “[t]he action will be commenced by the issue of process in the usual way, claiming the judgment sum as a debt” (Adrian Briggs and Peter Rees QC, Civil Jurisdiction and Judgments (Informa London, 5th Ed, 2009) (“Briggs & Rees”) at para 7.70). This position in law has its roots in the division between law and equity prior to the enactment of the Supreme Court of Judicature Act 1873 (c 66) (UK). A foreign judgment was generally thought to be enforceable only in a Court of Law – as opposed to a Court of Chancery (but see R W White, “Enforcement of Foreign Judgments in Equity” (1980–1982) 9 Sydney L Rev 630 (“White”)) – necessitating that the action be by way of a claim in assumpsit (ie, an action for recovery on a simple contract for definite sums of money).

[63] The nature of the enforcement action at common law is put down as a reason for the requirement that only foreign judgments for a fixed sum of money may be enforced. Since the proper action for the enforcement of a foreign judgment was an action in assumpsit, it follows that an action for the enforcement of non-money foreign judgments cannot be countenanced (see generally: Dicey, Morris & Collins at para 14-022; Briggs & Rees at para 7.71; The Conflict of Laws at pp 149–150; White; S Pitel, “Enforcement of Foreign Non-Monetary Judgments in Canada (and Beyond)” (2007) 3 JPIL 241; R F Oppong, “Enforcing Foreign Non-Money Judgments: an Examination of Some Recent Developments in Canada and Beyond” (2006) 39 UBC L Rev 257; K Pham, “Enforcement of Non-Monetary Foreign Judgments in Australia” (2008) 30 Sydney L Rev 663; and V Black, “Enforcement of Foreign Non-Money Judgments: Pro Swing v Elta” (2005) 42 Can Bus LJ 81). This reason has been the subject of criticism that the form of the remedy should not affect substantive rights and that, as described in The Conflict of Laws by Prof Briggs (at p 149), “[t]he tail may be wagging the dog”. Nevertheless, this requirement constituted the basis for one of the grounds of the Court of Appeal’s decision in Poh Soon Kiat, and it was neither the occasion nor the place of this court to examine its propriety.

[64] Be that as it may, the parties did not dispute that the PRC Judgment Sums were fixed and ascertained sums of money. The question was whether the PRC Judgment could constitute the basis of such a debt claim.

[65] Parties (and in particular the Defendant) did not dispute that the orders made in the PRC Judgment gave rise to an obligation on the part of the Defendant to pay the Plaintiff certain ascertained sums of moneys. The point of contention here was whether the obligation of the Defendant to pay the Plaintiff the PRC Judgment Sums could be enforced given that the generator sets were still in the Plaintiff’s possession.

[66] As a preliminary point, this issue raised the question as to which law should govern how the obligations owed by parties under a foreign judgment should be characterised for the purposes of enforcement. This was addressed by the Court of Appeal in Poh Soon Kiat which found (at [19]) that whether the Californian judgment was a “fresh foreign money judgment” was a matter to be determined according to Californian law. I respectfully agree. The court cited three authorities: Carl Zeiss Stiftung v Rayner & Keeler Ltd [1967] 1 AC 853 at 927; Colt Industries Inc v Sarlie (No 2) [1966] 1 WLR 1287 at 1293; and Beatty v Beatty [1924] 1 KB 807 (CA) at 816. I note that the three authorities cited stood for the proposition that the foreign law (and not the lex fori) determines whether a foreign judgment is final and conclusive for the purposes of recognition and enforcement, and did not directly concern the determination of the nature of the obligations owed under the foreign judgment. However, this issue was not raised before me by the parties whom – given the extensive expert evidence led on the matter – I took to accept that PRC law would apply in determining the issue. I therefore proceeded on that basis.

[67] In that regard, the parties sought to lead evidence from the PRC legal experts on the interpretation of the PRC Judgment and what the order for the Plaintiff to return the generator sets to the Defendant entailed. Both the experts were agreed that under PRC law principles of fairness and good faith informed the resolution of this issue. Mr Tang interpreted that to mean that the party who was in breach of the contract would have to bear the expenses of returning the generator sets. The orders made in the PRC Judgment were then scrutinised with that premise in mind.

[69] Mr Hua, however, disagreed. He was of the view that the PRC Court would not consider such matters until any subsequent claims for expenses incurred in fulfilling its obligations were in fact made by the Plaintiff. Mr Hua opined further that this would be the case even if, for example, the Plaintiff had an obligation to deliver the generator sets from the PRC to Singapore. I found that this was not consistent with the general principle of fairness and good faith which both experts agreed must inform the Plaintiff’s obligation to return the generator sets. It would not be fair if the Plaintiff’s obligation under the PRC Judgment entailed that it be put out of pocket until such time that it made a further claim before the PRC Court, notwithstanding that it was the innocent party.

[70] As mentioned earlier (see above at [11]), the Plaintiff was at all times ready and willing for the Defendant to collect the generator sets from them. The Defendant, however, had no such intention to do so. I found that the Plaintiff’s obligation being simply to allow collection of the generator sets by the Defendant, it had done all that was required of it under the PRC Judgment. Indeed, that was all that could reasonably be expected of it.

[71] To that end, the experts’ view that “the obligations set out in the PRC Judgment are to be performed simultaneously” was really beside the point. Whether the Defendant was in possession of the generator sets or not in this case had no bearing on its obligations to pay the Plaintiff the PRC Judgment Sums since it did not make any arrangement to collect the generator sets. It did not lie in the Defendant’s mouth to say that it did not have to perform its obligation to pay the Plaintiff the PRC Judgment Sums because it did not collect the generator sets.

Whether the Plaintiff’s claim was precluded because the PRC Judgment comprised other obligations which were not for a definite sum of money

[72] Since the Defendant owed an obligation to the Plaintiff for the payment of the PRC Judgment Sums, the question was whether this could be enforced here notwithstanding that the PRC Judgment also included the Plaintiff’s obligation to return the generator sets to the Defendant, the latter not being an order for payment of a fixed sum of money.

[73] Ms Chew’s submission in this regard was that a “judgment is enforceable so long as it orders the payment of ‘a definite sum of money’”, and it was beside the point that the PRC Judgment made further orders which were otherwise. The order for the Defendant to pay the Plaintiff the PRC Judgment Sums constituted a debt obligation which could found an action for enforcement in Singapore. Mr Goh submitted, on the other hand, that as long as the PRC Judgment contained obligations besides payment of a debt, the Plaintiff would be precluded from bringing a claim under the PRC Judgment.

[76] It followed that in the present case, the PRC Judgment ordering that the Defendant pay the Plaintiff the PRC Judgment Sums was capable of founding the Plaintiff’s debt claim in Singapore.

[77] As an aside, I should add that Ms Chew also sought to rely on the doctrine that objectionable parts of a foreign judgment could be severed from the rest of the judgment such that the unobjectionable parts of the judgment may be enforced. In support of her submission, Ms Chew cited Yeo at para 75.168:

[78] At first blush, Prof Yeo would seem to suggest that Ms Chew’s submission had some merit. However, this warranted further consideration. The basis behind Prof Yeo’s statement was the case of Raulin v Fischer [1911] 2 KB 93 which was also relied upon by Ms Chew. As pointed out by Mr Goh, the component of the judgment that was deemed objectionable in Raulin v Fischer was a penal payment based on a criminal sanction. Since a foreign penal law was unenforceable under private international law (see the English cases of Huntington v Attrill [1893] AC 150 and United States of America v Inkley [1989] QB 255), the English court severed that part of the judgment and enforced only the non-penal component of the foreign judgment. Ms Chew also relied upon the English Court of Appeal decision in Lewis v Eliades and others [2004] 1 WLR 692 (“Lewis v Eliades”). In Lewis v Eliades, the claimant obtained a judgment in the United States court which he sought to enforce in England. The judgment was for damages for breach of fiduciary duty and fraud, and damages based on statute. For the statutory damages, the claimant was entitled to treble damages, which were not enforceable in the English courts by reason of s 5 of the Protection of Trading Interests Act 1980 (c 11) (UK). Accordingly, the English court severed the statutory damages from the rest of the judgment and enforced that part of the judgment awarding damages for breach of fiduciary duty and fraud. The orders made in the PRC Judgment, however, were of a different nature entirely and did not involve the enforcement of foreign penal, revenue or other public laws. In that regard, I did not think it was appropriate to extend the concept of severance to the present case.

[79] In the light of my conclusion that the PRC Judgment ordering the return of the generator sets did not require the Plaintiff to transport the same to a location of the Defendant’s choice (it being the Defendant’s obligation to collect the same), I held that the Defendant’s obligation to pay the PRC Judgment Sums was enforceable in Singapore. To be clear, in arriving at this conclusion, I did not have to consider nor place any reliance on the validity or otherwise of the underlying claim in contract sued upon in the PRC Judgment.

[80] For the foregoing reasons, I found for the Plaintiff, and made the following orders:

(a) The Defendant shall pay the Plaintiff the PRC Judgment Sums as ordered in the PRC Judgment.

(b) The Defendant shall reimburse the Plaintiff the PRC Court Fees ordered under the PRC Judgment.

(c) The Defendant shall pay interest on:

(i) the PRC Judgment Sums; and

(ii) the PRC Court Fees at the rate of 6.56% per annum for the period from 26 April 2011 to 7 August 2013, amounting to US$28,513.53 and RMB3,258.65 respectively.

(d) The Defendant shall pay interest on:

(i) the PRC Judgment Sums; and

(ii) the PRC Court Fees

at the rate of 5.33% per annum from 8 August 2013 until date of full payment.

(e) The Defendant shall pay the Plaintiff costs to be taxed unless agreed.