AN INTERNATIONALIST APPROACH TO INTERPRETING PRIVATE INTERNATIONAL LAW? ARBITRATION AND SALES LAW IN AUSTRALIA.

• Date: 01 August 2020
• Author: Anastasi, Andrea

Contents I Introduction II Internationalist Interpretation as a Legal Requirement: The New York Convention, Model Law, and CISG A The New York Convention B The Model Law C The CISG III The Internationalist Interpretation of Australian ICA Law A Internationalist Interpretation and Australian Arbitration Law 1 Common Law Interpretation 2 The Purposive Approach 3 Extrinsic Materials B Case Study 1: Altain Khuder C Case Study 2: The TCL/Castel Saga 1 The TCL Constitutional Challenge 2 TCL's Final Enforcement Decision D Case Study 3: Parties Resisting Enforcement Based on the Legal Analysis of Arbitrators 1 Uganda Telecom v Hi-Tech Telecom 2 Indian Farmers Fertiliser Cooperative v Gutnick 3 The Sauber Decisions IV The Internationalist Interpretation of Australian International Sales Law A Internationalist Interpretation and Australian International Sales Law B Case Study 1: Selected Pre-2009 Decisions 1 Roder Zelt 2 Perry Engineering 3 Playcorp C Case Study 2: Selected Post-2009 Decisions 1 The Castel v Toshiba Cases 2 Fryer Holdings 3 NT Beverages V Analysis and Conclusion A Australia's CISG Legislation and Lessons from New Zealand B Other Reasons C The Way Forward I INTRODUCTION

[W]e will decide, and we should decide who comes to this country and not allow the interpretations of others outside this place decide what our international obligations are. (1) Private international law ('PIL'), broadly defined, is state law dealing with cases having a foreign element. (2) PIL is usually considered domestic law, even when having international origins. (3) This article examines judicial interpretations of internationally promulgated PIL in Australia. It argues, with reference to international commercial arbitration ('ICA') and international sales law, that these laws are legally required to be interpreted in an internationalist manner. It also demonstrates that interpretations of Australia's ICA laws have improved in the period following 2010 when measured against this standard, whilst simultaneously deteriorating in the sales law context.

This article defines internationalist interpretation as the interpretation of PIL legislation, by the courts, in a manner which pays due regard to its international nature and harmonising purposes. (4) Such interpretations may refer, for example, to foreign judicial or arbitral case law (notwithstanding its value is only persuasive) and international secondary sources (including travaux preparatoires: treaty negotiation records), with a view to interpreting laws consistently with their international understandings. (5) This article addresses internationalist interpretation by examining the interpretative rules applicable to select Australian-adopted PIL instruments, and the take-up of those rules in Australian case law.

Internationalist interpretation directly contrasts with the notion, reflected in this article's epigraph, that the interpretations of others do not 'decide what our international [treaty] obligations are' (6) That comment arose in the highly-political migration law context, a subject matter not addressed by this article. However, this article's examination of judicial attitudes to commercial law instruments concerns the same fundamental issue: the law's interpretation. This article's epigraph reflects parochial interpretation, internationalist interpretation's polar opposite. Parochial interpretations draw upon Australian sources, and are limited in their scope by an Australian worldview.

As applied to ICA and international sales law, internationalist interpretation raises important policy considerations. Differences in private law between jurisdictions are believed to create barriers to trade (7) and increase the costs of doing business, (8) while harmonised laws seek to lower those costs. (9) Through harmonisation, ICA and international sales laws seek to promote international trade. (10) In times of rising trade protectionism, their task of lowering merchant-to-merchant transaction costs takes on additional significance.

While simply adopting international instruments secures textual legal uniformity, judicial decisions are the means by which applied uniformity is secured, (11) which is what really matters for disputing merchants. (12) Though this article does not seek to validate the assumptions underpinning harmonised PIL, (13) instead taking them to be true, the practical importance of ensuring PILs applied uniformity justifies its own analysis. (14) Diverging interpretations of harmonised PIL instruments still generate the transaction costs sought to be reduced. (15) Parochial interpretations thus risk incentivising the avoidance of these laws by the very merchants intended to be benefited, frustrating their reason for existence. (16)

This article addresses three ICA and sales law instruments: the Convention on the Recognition and Enforcement of Foreign Arbitral Awards ('New York Convention'), (17) the UNCITRAL Model Law on International Commercial Arbitration in its 1985 ('Model Law 1985') and 2006 ('Model Law 2006') incarnations, (18) and the United Nations Convention on Contracts for the International Sale of Goods ('CISG'). (19) All are locally adopted. (20) The incorporation of these instruments into Australian law, (21) otherwise adhering to precedent and containing its own statutory interpretation rules, lays the groundwork for the internationalist-parochial interpretative tension under investigation. (22)

This article's joint examination of ICA and international sales law is justified by the practical convergence of these fields: ICA is empirically confirmed as the principal forum for resolving international sales disputes. (23) Nevertheless, the CISGs substantive law nature is a limitation of this article's analysis. Though it is PIL in the broadest, 'cases having a foreign element', sense, (24) the CISG does not address typical (procedural) PIL rules of jurisdiction, applicable law identification, or enforcement; (25) instead containing substantive contract law rules. (26) This article's comparison is thus not strictly like-with-like, a matter returned to in Part V, which partially explains the Australian courts' differing treatment of these two bodies of law.

This article's analysis is conducted in two stages. First, Part II analyses the abstract rules governing the New York Convention, Model Law, and CISG's interpretations. It identifies a legal requirement of internationalist interpretation for each, though for differing reasons given their very different natures. Second, Parts III and IV address the interpretative impact of the adoption of these instruments into Australian law. For the New York Convention and Model Law (Part III) and the CISG (Part IV), the extent to which Australian law requires their internationalist interpretation is assessed. Case studies are used to evidence trends in Australia's actual interpretative experience. Both stages of inquiry are necessary to assess whether these instruments are fulfilling their harmonisation objectives in Australia. It is one thing for instruments to be governed by internationally minded interpretative rules, but another for Australian courts to embrace that methodology. (27)

Part V concludes that Australia's track record of internationalist interpretation has improved in the period following 2010 with respect to ICA law, but deteriorated regarding the CISG. Possible explanations are identified, with recommendations made as to how the CISG reasoning of Australian courts might be improved. These recommendations (including legislative reforms) are directed at helping the CISG achieve its objects of benefiting local merchants and their international trading partners.

II INTERNATIONALIST INTERPRETATION AS A LEGAL REQUIREMENT: THE NEW YORK CONVENTION, MODEL LAW, AND CISG

As a matter of law, and in the abstract, the New York Convention, Model Law, and CISG all require internationalist interpretation. These instruments (a procedural law treaty, template legislation, and a substantive law treaty) have very different characters, implicating distinct interpretative considerations. This Part's analysis of how these instruments are to be interpreted, in themselves, allows Parts III and IV to analyse the impact of their Australian adoption.

A The New York Convention

The New York Convention establishes uniform rules for the recognition and enforcement of arbitral agreements and awards. (28) It constitutes PIL as traditionally understood, addressing procedural questions of jurisdiction and enforcement. (29) As a treaty, public international law governs its interpretation. Relevant principles, reflected in the Vienna Convention on the Law of Treaties ('VCLT'), include that:

1. A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in light of its object and purpose.

2. The context for the purpose of the interpretation of a treaty shall comprise, in addition to the text, including its preamble and annexes:

(a) any agreement relating to the treaty which was made between all the parties in connexion with the conclusion of the treaty;

(b) any instrument which was made by one or more parties in connexion with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty. (30)

Article 32 of the VCLT establishes that 'supplementary means of interpretation, including the preparatory work of the treaty and the circumstances of its conclusion' may be referred to when:

* confirming the ordinary meaning of treaty provisions; or

* Article 31 of the VCLTs interpretation 'leaves the meaning ambiguous or obscure, or generates 'manifestly absurd or unreasonable' results.

Unsurprisingly, given their source, these rules facilitate the New York Conventions internationalist interpretation. (31) Interpretation 'in light of its object and purpose' (32) implicates the pursuit of applied...