Academic journal article Australian International Law Journal

International Jurisdiction Agreements and the Recognition and Enforcement of Judgments in Australian Litigation: Is There a Need for the Hague Convention on Choice of Court Agreements?

Academic journal article Australian International Law Journal

International Jurisdiction Agreements and the Recognition and Enforcement of Judgments in Australian Litigation: Is There a Need for the Hague Convention on Choice of Court Agreements?

Article excerpt

ABSTRACT

One of the difficulties faced by judges and practitioners when dealing with disputes arising from international commercial transactions is in the application and enforcement of a choice of court or foreign jurisdiction clause to determine the relevant court to adjudicate the dispute. This article explores the process undertaken by Australian courts when deciding whether they should exercise jurisdiction. In addition, the legal uncertainty arising from the distinction drawn between exclusive and non-exclusive jurisdiction clauses, and the ambiguous approach employed in the enforcement of a jurisdiction clause is considered. The Hague Conference on Private International Law has developed the Hague Convention on Choice of Courts Agreement 2005 and it is intended to promote the enforceability of exclusive choice of court agreements and establish the international recognition and enforcement of resulting judgments. This article considers whether Australia should, like its American and European counterparts, take steps to sign and ratify the Hague Convention. Further, the article also assesses the impact the Convention will have in resolving jurisdictional issues faced by Australian courts and the recognition and enforcement of a resulting decision. Finally, the article posits that the Hague Convention will clarify the uncertainties facing Australian courts in international jurisdictional disputes.

Introduction

In early 2009, two of the world's major economies signed the Hague Convention on Chow of Court Agreements ('Hague Convention'). The United States (19 January 2009) and the European Community (l April 2009) signed the Hague Convention, while other States like Argentina, Canada and Singapore continue to actively consider ratification (or accession to) the Hague Convention. After accession by Mexico on 26 September 1997, the Convention awaits a second ratification or accession before it: will come into force. (1)

The Hague Convention was designed to reduce the time and expense courts and businesses face when dealing with international jurisdictional issues, and the recognition and enforcement of foreign court decisions. Thus, litigants are assured that any disputes adjudicated between them will be resolved in their chosen forum.

The use of choice of court or foreign jurisdiction clauses in Australia however is not always upheld due to the distinction drawn between exclusive and non-exclusive jurisdiction clauses. Further, the approach employed in ascertaining whether jurisdiction clauses will be enforced is not always clear. The uncertainty that results from both these issues raises the question of whether Australia should, like its American and European counterparts, take steps to sign and ratify the Hague Convention. If Australia were to ratify the Hague Convention, resulting judgments will also benefit in the same way that international arbitration agreements and awards have benefited under the highly successful New York Convention, (2) through the recognition and enforcement provisions.

Before any of these issues can be explored further, it is necessary to first, by way of background, trace the development of the Hague Convention (discussed in Part 1 of this article). Part 2 will then explore and assess the Australian approach when resolving jurisdictional issues involving choice of court agreements before turning to the question of whether Australia should adopt the Hague Convention (discussed in Part 3). A discussion on the impact of the recognition and enforcement of foreign judgments in Australia upon concluding the Convention will be reviewed in Part 4. This is followed by concluding remarks in Part 5.

1. The Hague Convention as a Binding Legal Instrument

The Hague Convention was negotiated and concluded in the framework of the Hague Conference on Private International Law ('Hague Conference'). (3) The Convention seeks to reinforce exclusive choice of court agreements and additionally, to ensure mutual recognition and enforcement of judgments between Contracting States. …

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