Intermetal Group Ltd v Worslade Trading Ltd

• Jurisdiction: Ireland
• Judge: Mr Justice Francis D Murphy
• Judgment Date: 06 March 1998
• Neutral Citation: 1998 WJSC-SC 2238
• Court: Supreme Court
• Docket Number: [1997 No. 13943P and S.C. Nos. 395 and
• Date: 06 March 1998

INTERMETAL GROUP LTD v. WORSLADE TRADING LTD

Between

Intermetal Group Limited & Trans-World (Steel) Limited

Plaintiffs

AND

Worslade Trading Limited

Defendant

1998 WJSC-SC 2238

Murphy J

Lynch J

Barron J

No. 395 & 403/1997

THE SUPREME COURT

Synopsis

Conflict of Laws

Forum non conveniens; non- EU state; tort of inducing breach of contract; injunctive relief sought; whether Ireland appropriate forum for determining disputes between parties; whether justice requires stay to be granted; test to be applied in determining appropriate forum; consideration of jurisdiction with which proceedings most closely connected; principles for granting injunctive relief; whether tort of inducing breach of contract known to foreign jurisdiction; whether Brussels Convention applicable to doctrine of forum non conveniens

Held: Appeal dismissed; stay refused; Ireland appropriate forum;

Intermetal Group Ltd. v. Worslade Trading Ltd. - Supreme Court: Murphy J., Lynch J., Barron J. - 06/03/1998 - [1998] 2 IR 23

Citations:

BRUSSELS CONVENTION ART 2

VIENNA CONVENTION ON DIPLOMATIC RELATIONS

ATLANTIC STAR, THE 1974 AC 436

ROCKWARE GLASS V MACSHANNON 1978 AC 795

ST PIERRE V SOUTH AMERICAN STORES LTD 1936 1 KB 382

JOSEPH MURPHY STRUCTURAL ENGINEERS V MANITOWAC UNREP SUPREME 30.7.1985 1985/5/1273 1988 DULJ 174

SPILIADA MARITIME CORP V CANSULEX 1987 AC 460

DOE V ARMOUR PHARMACEUTICAL CO INC 1994 3 IR 78

HARRODS (BUENOS AIRES) LTD (NO 2), IN RE 1992 CH 72

COMPANIES ACT 1985 S459 (UK)

COMPANIES ACT 1985 S461 (UK)

CAMPUS OIL V MIN FOR INDUSTRY (NO 2) 1983 IR 88

PHILLIPS V EYRE 1870 LR 6 QB 1

PROTOCOL ON BRUSSELS CONVENTION 1971 ART 3

JURISDICTION OF COURTS & ENFORCEMENT OF JUDGMENTS (EUROPEAN COMMUNITIES) ACT 1988 SCHED 2

1 Judgment of Mr Justice Francis D Murphy delivered the 6th day of March 1998 [NEM DISS]

2 The proceedings herein were instituted by plenary summons issued on the 24th day of November 1997 by which the Plaintiffs claimed (inter alia):-

"An injunction restraining the defendant, whether by itself, its directors, servants or agents, or any person action in concert with it, or otherwise howsoever, from inducing or procuring breaches of or other wise unlawfully interfering in contracts between the first named plaintiff (hereinafter referred to as "Intermetal") and Novolipetzk Iron and Steel Corporation (hereinafter referred to as "NLMK"), in particular the contract between NLMK and Intermetal under which NLMK undertook to sell steel representing approximately 95% of its steel production for export to Intermetal."

3 In addition to that and other injunctive relief claimed by the Plaintiffs an order was sought directing the Defendant to make a widely raging affidavit of discovery disclosing business transactions of the Defendant in relation to the sale or supply of any part of the NLMK steel production for export as well as disclosing the names and addresses of persons to whom the Defendant had published certain statements relating to the relationship between the Plaintiffs and NLMK. An injunction was also sought to restrain the Defendant from disposing of, dealing with or diminishing the value of any of its assets up to a value of St£50,000,000.

4 A notice of motion was returned for hearing on the 27th November 1997 pursuant to which the Plaintiffs claimed by way of interlocutory relief the remedies claimed in the plenary summons. A further motion dated the 28th day of November 1997 was issued by the Defendant claiming an order striking out or staying the proceedings herein on the grounds of "forum non conveniens".

5 The Plaintiffs motion was grounded primarily upon the affidavit or Mel Wilde an executive director of Trans-World (Steel) Limited. In the days following the swearing of Mr Wilde's affidavit the documentation relating to the two motions proliferated. Twenty-two further affidavits were sworn and numerous documents exhibited.

6 The two motions were heard by Mr justice O'Sullivan on the 4th, 5th, 9th and 10th of December 1997. Two days later the learned trial Judge delivered a written judgment setting out the complex history of the mater, analysing the facts disputed in the numerous affidavits and reviewing the international conventions and decided cases relating to the evolving law which governs the dispute between the parties. The expedition with which the matter has been dealt is not merely commendable: it is a material factor in the consideration of the issues herein.

7 Mr justice O'Sullivan refused the application of the Defendant to stay the proceedings on the basis of "forum non conveniens" and granted an interlocutory injunction restraining Worslade Trading Limited (Worslade) from:-

"(a) procuring or attempting to procure the breach of any of the agreements (specified in paragraph 6 of the affidavit of Mel Wilde sworn on the 23rd of November 1997) between the first named Plaintiff and Novolipetzk Iron & Steel Corporation (hereinafter referred to as NLMK) during their respective subsistence as specified in the schedule to exhibit MW2 to the said affidavit (b) procuring or attempting to procure the breach of any agreement in existence as of the 12th of December 1997 between the second named Plaintiff and any of its customers (which customers and contracts are to be notified in writing to the Defendant's Solicitors Messrs A & L Goodbody) which relate to NLMK steel."

8 The learned trial Judge declined to grant any of the other injunctions or relief sought by the Plaintiffs.

9 By notice of appeal dated the 19th December 1997 the Defendant appealed to this Court from the order and judgment of O'Sullivan J and by notice dated the 23rd December 1996 the Plaintiffs sought the variation of the order of the learned trial Judge so as to obtain certain of the relief refused to them on their notice of motion. In addition the Plaintiffs sought to have the Defendant's motion dismissed on the additional ground that by virtue of Article 2 of the Brussels Convention 1968 the doctrine of "forum non conveniens" cannot be invoked in these proceedings.

THE PARTIES

10 Intermetal Group Limited is a company incorporated in the British Virgin Islands in the year 1993. It is wholly owned subsidiary of Trans-World Metals SA. Those companies and the secondly named Plaintiff, Trans-World (Steel) Limited, are members of a Group of international private companies (the Group) whose principal business involves dealing in steel, aluminium and ferro alloys. The annual turnover of the Group is claimed to be in excess of US$3.5 billion. Trans-World (Steel) Limited (Trans-world) is incorporated in the United Kingdom. From the late 1980s, and more particularly from 1992 onwards, the Group was endeavouring to establish commercial relationships with steel producers in the former Soviet Union. As Mr Wilde explained in his affidavit, the Plaintiffs retained the services of a Mr Lev Chernoi to assist in making contact with steel producers in Russia and implementing arrangements with them. Apparently Mr Chernoi appointed a Mr Lisin as the representative of the then newly formed Intermetal to negotiate and procure business on behalf of that company. Mr Lisin in turn appears to have controlled an organisation of some twenty people of whom a Mr Karen Sarkisov and a Mr Alex Koslov were the principal administrators.

11 The next person to be introduced is the Russian steel smelter Novolipetesk Iron and Steel Corporation (NLMK) which is apparently a very substantial publicly quoted Russian company. It is one of the twenty largest steel mills in the world. It employs 40,000 people. Mr Sarkisov in an affidavit sworn by him stated that 200,000 of the 500,000 inhabitants of Lipetsk are dependant on NLMK for their livelihood. NLMK is not a party to the present proceedings.

12 The Defendant, Worslade, was apparently a "shelf company". In his first affidavit Mr Sarkisov explained that the Defendant company "was acquired" at the end of September 1997 from company formation and management specialists Goldine & Goose Nominee Services Limited (USA. What Mr Sarkisov does not say is by whom it was acquired. It does appear the total issued share capital is £2 and the only person identified by him as being a director of the company was Mr Alexandre Goldine. The registered office of the company is given as Merchants House, 27/30 Merchants Quay - sometimes spelt Quai - Dublin 8 in the Republic of Ireland. A telephone number is given which is clearly an Irish telephone number. Some correspondence emanating from that address is signed by "G & G Company Secretaries" others by Mr Sarkisov and more by Mr Goldine. Some of the exhibited correspondence is in Russian; more in English. Nobody residing in Ireland has been identified as a director, officer or employee of the company. However it is the essence of these proceedings that the Defendant has carried on the business of marketing steel exported by NLMK and indeed Mr Sarkisov confirms that that was the purpose for which the company was acquired.

THE RELATIONSHIP BETWEEN THE PARTIES.

13 There were apparently two aspects to the relationship between the Group and NLMK. First the Group agreed to provide a facility in the order of $500 million to enable the Russian producer to improve the quality and reliability of its product. Secondly, the parties entered into a series of agreements relating to the sale and supply of steel of a variety of qualities and grades. These are described as the ten frame agreements. Mr Wilde claim that under those agreements Intermetal purchased approximately 450,000 tonnes of steel every month from NLMK and this amounted to approximately 95% of the Mills export capacity. Intermetal in turn entered into a contract with Trans-World under which Intermetal sold on the metals so purchased to Trans-World for sale to third party customers. One of the many issues between the parties...