Neilson v Overseas Projects Corporation of Victoria Ltd

• Jurisdiction: Australia Federal only
• Judge: Gleeson CJ,McHugh J,Gummow,Hayne JJ.,Kirby J.,Callinan J.,Heydon J.,and
• Judgment Date: 29 September 2005
• Neutral Citation: 2005-0929 HCA C,[2005] HCA 54
• Court: High Court
• Docket Number: P85/2004
• Date: 29 September 2005

[2005] HCA 54

HIGH COURT OF AUSTRALIA

Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan AND Heydon JJ

P85/2004

Barbara Mary Josephine Neilson

Appellant

and

Overseas Projects Corporation of Victoria Ltd & Anor

Respondents

Representation:

B W Walker QC with A S Bell and P Kulevski for the appellant (instructed by Talbot & Olivier)

G Griffith QC with L G De Ferrari and A B Lu for the respondent (instructed by Minter Ellison)

Neilson v Overseas Projects Corporation of Victoria Ltd

Private international law — Foreign tort — Choice of law — Appellant was injured in the People's Republic of China — Scope of the lex loci delicti — Where the lex loci delicti treats another connecting factor, such as nationality or domicile, as determining the applicable law — Whether Article 146 of the General Principles of Civil Law of the People's Republic of China was a relevant part of the lex loci delicti — Whether Article 146 of the General Principles of Civil Law of the People's Republic of China made the law of the parties' domicile the applicable law — Whether the doctrine of renvoi applies to international tort claims — Infinite regression of reference.

Evidence — Foreign law — Principles governing admission of evidence of foreign law — Where there is a deficiency of evidence — Whether there is a presumption that foreign law is the same as the law of the forum.

Words and phrases — ‘lex loci delicti’, ‘choice of law’, ‘renvoi’, ‘single renvoi’, ‘double renvoi’, ‘infinite regression of reference’.

ORDER

• 1. Appeal allowed with costs.

• 2. Set aside the orders of the Full Court of the Supreme Court of Western Australia made on 3 May 2004 that set aside:

  • (a) the judgment entered at trial in favour of the plaintiff; and

  • (b) the order made at trial for her costs.

• 3. In their place, order that the appeal to the Full Court against the judgment and order entered at trial be dismissed with costs.

1 Gleeson CJ. The issues in this appeal are narrower than those raised at trial. Furthermore, the issues at trial were narrower than those that might have been raised. It was for the parties to define the issues, and adduce such evidence as they chose. The case involved foreign law. It is possible, perhaps even likely, that the evidence of foreign law was incomplete. Nevertheless, it was necessary for the trial judge to decide the issues raised by the parties on the evidence which they presented. This is adversarial litigation, and the outcome of such litigation is commonly influenced by the way in which the parties have chosen to conduct their respective cases. Decisions about such conduct may have been based on tactical and other considerations which are unknown to a trial judge or an appellate court.

2 This appeal is concerned only with the claim made by the appellant against Overseas Projects Corporation of Victoria Ltd (‘OPC’) for damages for personal injuries suffered as a result of OPC's negligence. The appellant's husband was engaged by OPC to work on a project in Wuhan, in the People's Republic of China (‘PRC’). His family went there with him. They were accommodated in a flat provided by OPC. The appellant fell down the stairs. She claimed that the stairs were dangerous, and that OPC, which owed her a duty to take reasonable care for her safety, was in breach of that duty. That claim was framed in conventional common law terms based on occupier's liability. The questions of duty, breach and damage were resolved in the appellant's favour, and are not presently in issue.

3 The action was brought in the Supreme Court of Western Australia. Counsel for the appellant informed the trial judge (McKechnie J), in his opening, that he would lead no evidence of PRC law, and intended to say as little about that topic as possible. His opponent, however, relied on PRC law and, in the course of the defence case, tendered English translations of the General Principles of Civil Law of the PRC (‘the General Principles’) and of the Code of Civil Procedure of the PRC, and an opinion of the Supreme People's Court (in Mandarin) on the implementation of the General Principles. He also called a Chinese lawyer, Mr Liu, who had law degrees from Shanghai University and from an Australian university. Mr Liu referred to, and translated portions of, the Supreme People's Court opinion. Following his cross-examination of Mr Liu, counsel for the appellant tendered a law journal article on PRC personal injury law.

4 Counsel for the first respondent argued that the substantive law to be applied by McKechnie J was the law of the PRC; that, according to that law (for reasons that are not material to this appeal), OPC did not assume any civil liability to the appellant; and that, if it did, such liability was extinguished under Art 136 of the General Principles, which specified a limitation period of one year for demands for compensation for bodily harm. Although McKechnie J decided the case by applying Australian law, relying in that regard on Art 146, he also dealt with those arguments and decided them against OPC. In particular, he dealt with the limitation point on the basis that Art 137 allowed a court, ‘under special circumstances’, to extend the limitation period. He found that there were special circumstances. The Full Court disagreed with his reasoning on that question, but the issue does not arise if McKechnie J's decision based on Art 146 is upheld. The case has been argued at all levels on the assumption (which may or may not be correct) that, if the second sentence of Art 146 applied, Arts 136 and 137 were irrelevant.

5 The Full Court of the Supreme Court of Western Australia held that McKechnie J was wrong to invoke Art 146 and apply Australian law. That has been the focus of the present appeal.

6 The case has been conducted on the assumption that the General Principles, and in particular Art 106, which imposes civil liability either on the basis of fault or pursuant to legal stipulation, applied, or potentially applied, to the relations between the appellant and OPC and, further, that both the appellant and OPC were nationals of Australia within the meaning of Art 146 and, therefore, foreigners within the meaning of Art 142. Those may not be surprising assumptions, but they were not the subject of evidence and it is necessary, therefore, to note that they were not in dispute. Furthermore, no issue was raised concerning any complexities that might result from Australia's federal system. Article 146 of the General Principles seems to rise above questions of federalism, and the parties did not raise such questions in their evidence or arguments.

7 The General Principles are divided into nine Chapters. Chapter I is headed: ‘Fundamental Principles’. It includes Art 8, which provides that, unless otherwise stipulated, the laws of the PRC apply to civil activities carried out within the PRC, and the provisions of the General Principles with regard to citizens apply to foreign nationals within the territory of the PRC. Chapters II and III deal with the status of ‘natural persons’ and ‘legal persons’, the former being citizens, and the latter being organisations possessing legal capacity. Chapters IV and V are not relevant. Chapter VI deals with civil liability, and includes Art 106 which has been summarised above. Chapter VII deals with limitation of actions, and includes Arts 136 and 137 to which reference has already been made. Chapter VIII is headed: ‘Application of the Law to Civil Relations involving Foreigners’. It commences with Art 142, which states that the application of the law to civil relations involving foreigners shall be determined by the provisions of Ch VIII. It includes Art 146.

8 Not much was said in evidence about Art 146. The first sentence provides that, in a claim for compensation for damages resulting from an infringement of rights, the law of the place where the infringement occurred shall be applied: in the case of a fault-based claim such as the present, the lex loci delicti. Since Art 146, according to Art 142, applies to civil relations involving foreigners, the first sentence has general application to foreigners. Whether the first sentence of Art 146 would apply to a dispute between two citizens of China arising out of personal injury caused by one to the other in, say, Japan was not considered in evidence. The second sentence deals with a more particular case of civil relations involving foreigners. It applies only where the parties are nationals of the same country, or domiciled in the same country. It would have no application in the present case if, for example, OPC had been a Delaware corporation. (In argument it was assumed that the appellant, a Western Australian resident, and OPC, a Victorian corporation, were nationals of the same country. What would have happened if the laws of Victoria and Western Australia had been materially different was not considered.) Where both parties are nationals of the same country (relevantly, Australia), Art 146 says that the law of their own country may be applied.

9 McLure J, who gave the reasons of the Full Court, reasoned that this raised a question of renvoi; that Art 146 was a choice of law rule; that Australian law directed the Western Australian court to apply the law of the PRC as the lex loci delicti1; that the law of the PRC for that purpose did not include its choice of law rules; and that Art 146 was irrelevant. Her reasoning, which was supported by a body of learned opinion on the subject of renvoi, would have been exactly the same if the second sentence of Art 146 had been mandatory rather than permissive.

10 Subject to one qualification, there was no evidence as to any other laws of the PRC which affect the operation of the second sentence in Art 146. It was not shown that the Supreme People's Court had given any...