Zhousan Xinhong v. Sino Trans & Another
The first Defendant in this case applied to stay the Hong Kong proceedings relying on a foreign jurisdiction clause allegedly contained in the Bill of Lading. The court, applying the principles stated in "EL Amria" to the circumstances of this case, exercised its discretion to refuse the stay. The application was accordingly dismissed.
DMC Category Rating: Confirmed
This case note is contributed byCrump & Co, the International Contributors to the website for Hong Kong
The first Defendant applied for a stay of the action on the ground that the bill of lading contained on its reverse a jurisdiction clause in favour of the Ningbo Maritime Court of the People’s Republic of China. However, the first Defendant failed to produce the original bill of lading or a copy of the reverse side of the relevant bill, to prove the existence of this provision. The second Defendant accepted the jurisdiction of the Hong Kong court.
It was accepted that there was no close connection between the Defendants and Hong Kong, apart from their having a business address in Hong Kong and that, if the case continued in Hong Kong, witnesses would have to be called from China and Japan. Further relevant considerations were that, under Clause 4 of the contract of carriage, the applicable law was that of the People’s Republic of China, and that, under Clause 24 of the Bill of Lading, all suits had to be brought within nine months after the delivery of the goods. The goods were delivered on 6 September 2005. The nine months limitation period had thus expired in June 2006.
" In exercising its discretion whether or not to grant a stay, the court considers al the circumstances of the case, and the following formulation of the particular factors to be taken into account has been much relied upon: (1) in which country the evidence is available, and the effect of that on relative convenience and expense of a trial in England or aboard; (2) whether the contract is governed by the law of the foreign country in question, and if so, whether it differs from English law in any material respect (3) with what country either party is connected, and how closely; (4) whether the Defendants genuinely desire trial in a foreign county, or are only seeking procedural advantages (5) whether the Plaintiffs would be deprived of security for their claim, or be unable to enforce the judgment in their favour, or be faced wit a time-bar not applicable in England, or for political , racial, religious or other reasons be unlikely to get a fair trial. The fact that a stay will result in concurrent proceedings with different parties, but similar issues, may militate against a stay."
After weighing all the circumstances of the case, the judge concluded that the Plaintiffs’ position would be prejudiced if the proceedings were stayed.
At paragraphs 41 and 44 of her judgment, she said:
The Judge accordingly refused to exercise her discretion to stay the proceedings.
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