New South Wales Supreme Court CITATION : Yan Xie v Chen Shaoji [2008] NSWSC 224 HEARING DATE(S) : 10 March 2008 JUDGMENT DATE : 17 March 2008 JURISDICTION : Common Law JUDGMENT OF : Simpson J On the notice of motion filed on behalf of the Attorney General for the Commonwealth of Australia: (i) leave granted to intervene in the proceedings; DECISION : (ii) in the first instance, leave limited to making submissions concerning the procedures for effecting service of process where the Foreign States Immunities Act 1985 is applicable. On the notice of motion filed on behalf of the plaintiffs: (i) the notice of motion is dismissed. CATCHWORDS : PRACTICE AND PROCEDURE – application of the Attorney General to appear as intervener or alternatively as amicus curiae – application for default judgment by the plaintiffs – whether service on the defendant was effected in accordance with the Foreign States Immunities Act 1985 – appearance and defence not entered by the defendant LEGISLATION CITED : Foreign States Immunities Act 1985 Uniform Civil Procedure Rules 2005 CATEGORY : Procedural and other rulings Adams v Adams [1971] P 188 Australian Railways Union v Victorian Railways Commissioners [1930] HCA 52; 44 CLR 319 Bouzari & Ors v Islamic Republic of Iran (2002) 124 ILR 428 Corporate Affairs Commission v Bradley [1974] 24 FLR 44; [1974] 1 NSWLR 391 CASES CITED : Fang & Ors v Jiang & Ors [2007] NZAR 420 Lange v Australian Broadcasting Corporation [1997] HCA 25; 189 CLR 520 Levy v The State of Victoria [1977] HCA 31; 189 CLR 579 Rushby v Roberts [1983] 1 NSWLR 350 The Queen v Anderson; Ex parte Ipec-Air Pty Ltd [1965] HCA 27; 113 CLR 177 Theophanous v The Herald and Weekly Times Ltd [1994] HCA 46; 182 CLR 104 Yan Xie and Fuying Li (Plaintiffs) PARTIES : Chen Shaoji (Defendant) Attorney General of the Commonwealth (Intervener) FILE NUMBER(S) : SC 20501 of 2006 D K L Raphael/A Ketas (Plaintiffs) COUNSEL : No appearance (Defendant) H Burmester QC (Intervener) Not applicable (Plaintiffs) SOLICITORS : Not applicable (Defendant) Australian Government Solicitor (Intervener) IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION Simpson J 17 March 2008 20501/06 Yan Xie & Anor v Chen Shaoji JUDGMENT 1 HER HONOUR: Two competing notices of motion are before the Court and were heard together. Chronologically, the first, filed on 8 November 2007 on behalf of the plaintiffs, seeks default judgment (Uniform Civil Procedure Rules 2005, 16.7) in the substantive proceeding, an assessment of damages and costs. The second, filed in court by leave on 10 March 2008 (but earlier foreshadowed) is an application by a non-party to the substantive proceeding (the Attorney General for the Commonwealth of Australia) to be granted leave to appear as an intervener in the proceeding, or, alternatively to appear as amicus curiae. 2 The substantive proceeding was commenced by statement of claim filed on 6 December 2006. It names two plaintiffs and one defendant, Chen Shaoji. In short, each plaintiff alleges that, while living in the People's Republic of China ("the PRC") between 2000 and 2004 (the first plaintiff) and during 2000 (the second plaintiff) she was arrested, unlawfully detained, tortured and subjected to physical and mental abuse. Each pleads that the defendant was, at all material times, "the Party Secretary of the Chinese Communist Party Guangdong Political and Judicial Committee". Each plaintiff pleads the torts of negligence, assault and battery and claims damages in respect thereof. 3 The defendant has not entered an appearance (UCPR 6.9) nor filed a defence (UCPR 14.3). It is for this reason that entry of judgment is sought on behalf of the plaintiffs. 4 However, an issue has arisen as to the effectiveness of the purported service of the statement of claim. Two affidavits of service have been filed, each attesting, in some detail, to the delivery (to use a neutral term) of a copy of the statement of claim personally to the defendant. 5 I will return to these affidavits when I come to consider the plaintiffs' notice of motion seeking default judgment. 6 A question has arisen as to the sequence in which the competing claims ought to be determined. I have concluded that, although it is the later in time, the notice of motion filed on behalf of the Attorney General ought receive first consideration. That is because, if he is granted leave to intervene, then, depending upon any limitations placed upon that leave, he may have some light to cast upon the determination of the plaintiffs' notice of motion. Given that the defendant has not appeared and is not represented and has therefore made no submissions in respect of the entry of default judgment, that is potentially of considerable assistance to the Court. Intervention 7 The pleading concerning the position of the defendant signals the possible applicability of the Foreign States Immunities Act 1985 ("the FSI Act"). By s 9 of the FSI Act a foreign State is immune from the jurisdiction of the courts of Australia in a proceeding. By s 40 of the FSI Act the Minister for Foreign Affairs may certify in writing (inter alia) that, for the purposes of the FSI Act a specified person is or was at a specified time, part of the government of a foreign State. By sub-s (5) such a certificate is admissible as evidence of, and conclusive as to, the facts and matters stated therein. 8 On 21 January 2008, the Minister for Foreign Affairs, Stephen Francis Smith, certified that the defendant was part of the government of a foreign State within the meaning of the FSI Act at the time of the alleged acts the subject of the claim, at the time of the purported service of the statement of claim, and as at the date of the certificate. 9 Although, in my opinion, it was unnecessary to do so, the Minister set out the various positions the defendant had held during the relevant times, and the facts and matters he took into account in reaching the conclusion stated in the certificate. 10 It can be discerned from the statement of claim that the defendant is sued in his capacity as a functionary of the government of the People's Republic of China. In those circumstances the FSI Act is relevant. It is for this reason, and, in part, to make submissions to the Court concerning the effectiveness or otherwise of the purported service of the proceeding (having particular regard to the special provisions of the FSI Act concerning service of proceedings), that the Attorney General seeks leave to intervene. 11 It is important to bear in mind that the certificate, which was tendered on behalf of the Attorney General, is evidence, only at this stage, in respect of the Attorney General's application for leave to intervene. Should leave be granted, then, no doubt, the certificate can be taken into account also on the second issue, of the entry of default judgment. It is not, at this stage, evidence that could have the effect of terminating the plaintiffs' proceeding. 12 The extent to which the court may permit a non-party to intervene in inter-partes litigation is not easy to define. One avenue by which this can be done is UCPR 6.24(1). That sub-rule provides: "(1) If the court considers that a person ought to have been joined as a party, or is a person whose joinder as a party is necessary to the determination of all matters in dispute in any proceedings, the court may order that the person be joined as a party." 13 The Attorney General's application does not fit easily into this formulation. The sub-rule envisages joinder, or intervention, in two specified circumstances: · where the court considers that that person ought to have been joined as a party (in the first place); · where the court considers that joinder of that person as a party is necessary to the determination of all matters in dispute in the proceedings. 14 The first can immediately be put to one side: there is no reason to conclude that the Attorney General ought, in the first place, to have been joined as a party. But the second is also inapt: the joinder of the Attorney General is not necessary to the determination of "all matters" in dispute between the plaintiffs and the defendant. Indeed, in the absence of a defence, just what is in dispute cannot be categorically, or even tentatively, identified. Even if one assumes that all allegations in the statement of claim are in dispute, it is impossible to see that the joinder of the Attorney General is necessary to the determination of these matters. 15 Recognising the difficulty of fitting the application into the literal words of the sub-rule, senior counsel who appeared for the Attorney General contended that there exists a parallel inherent power in the court to permit intervention in an appropriate case; and, implicitly, that this power is wider than that specified in UCPR 6.24(1). That such a power exists was expressly conceded by counsel for the plaintiffs. 16 Such a power has been exercised or refused in a variety of circumstances, and there is little unanimity as to its parameters. 17 A useful starting point is the reasoning of Dixon J (as he then was) in Australian Railways Union v Victorian Railways Commissioners [1930] HCA 52; 44 CLR 319. His Honour said: "I think we should be careful to allow arguments only in support of some right, authority or other legal title set up by the party intervening. Normally parties, and parties alone, appear in litigation … The discretion to permit appearances by counsel is a very wide one; but I think we would be wise to exercise it by allowing only those to be heard who wish to maintain some particular right, power or immunity in which they are concerned, and not merely to intervene to contend for what they consider to be a desirable state of the general law under the Constitution without regard to the diminution or enlargement of the powers which as States or as Commonwealth they may exercise." 18 These words are a strong indication of the caution which needs to be exercised in relation to permitting non-parties to intervene in litigation between parties. They gain additional force when it is recognised that (in the passage which has been omitted from the extract) they were made in the context of an application by two States to intervene in proceedings raising constitutional issues. They gather even more force when it is seen that, even in those circumstances, leave was, by a 4:1 majority, refused. 19 Similarly, leave was refused to the State of South Australia seeking to intervene in a proceeding in the High Court in The Queen v Anderson; Ex parte Ipec-Air Pty Ltd [1965] HCA 27; 113 CLR 177. Kitto J said: "The Court not infrequently allows a State or the Commonwealth to intervene in litigation to which it is not a party, but only in cases where it can be seen that the decision of the Court can have a bearing, or may have a bearing, upon the legislative or executive powers or other direct interests, I suppose, of the State or Commonwealth, as the case may be." 20 These passages, in my opinion, demonstrate the quite restrictive approach that has been taken to permitting intervention by a non-party. However, there is another line of authority, peculiarly relevant to such an application when it is made by or on behalf of government. In the United Kingdom, in Adams v Adams [1971] P 188, Sir Jocelyn Simon P was considering whether United Kingdom law would recognise the dissolution of a marriage by "a purported decree" of divorce of the High Court of Rhodesia at a time when the United Kingdom did not recognise the government of that country. On its face, the case was simply one between two individual parties to a marriage, but, because of the surrounding circumstances, was said to raise "grave constitutional issues", and affect the personal lives of a number of people besides the litigants to that proceeding. The Attorney General claimed a right of intervention on the ground that constitutional issues arose in which the Sovereign's rights might be affected. 21 Simon P said: "In my view the Attorney General has a right of intervention in a private suit whenever it may affect the prerogatives of the Crown, including its relations with foreign States … and he certainly has in such circumstances a locus standi at the invitation of the court … I think that the Attorney General also has the right of intervention at the invitation or with the permission of the court where the suit raises any question of public policy on which the executive may have a view which it may desire to bring to the notice of the court. Public policy is a matter of which the courts take direct judicial cognisance, and they do not allow evidence on the point …" 22 In the Corporate Affairs Commission v Bradley [1974] 24 FLR 44; [1974] 1 NSWLR 391 Hutley JA traced the history of the power to permit intervention, particularly with respect to intervention by government or government bodies. He rejected the notion of an inherent power to permit intervention, but excluded from that the possibility that "inherent privileges" of the Attorney General of the Commonwealth permitted it, in which case, he said, the procedure of the court must accommodate that privilege. He agreed with Simon P that, in a class of case, the Attorney General appeared, not by leave, but by right, the right being dependent upon: "… whether the prerogatives of the Crown in relation to foreign powers are in issue before the court." He included in this circumstances where statutory powers similar to the prerogatives are in issue. 23 The class of case in which, Hutley JA held, the Attorney General is able to appear by right as distinct from by leave, were identified as those: "… where the prerogatives of the Crown in relation to foreign powers are likely to be affected." Putting it another way, he said: "… in my opinion the authorities establish that the Attorney-General has a right to appear as intervener where, in relation to the prerogative or the statutory powers of the Crown in relation to foreign states, an issue as to the extent of such powers arises." 24 Hutley JA departed, however, from the views of Simon P in respect of the asserted entitlement of the Attorney General to appear for the purpose of advancing public policy considerations. He rejected this because he considered it to be a trespass upon judicial independence. 25 Bradley must be treated with some caution; in Rushby v Roberts [1983] 1 NSWLR 350 Street CJ (presiding over a court of which Hutley JA was a member) cast considerable doubt upon its correctness. As I read the judgment of the Chief Justice, the aspect of Bradley which he doubted was the conclusion that the court does not have an inherent power to permit intervention. 26 The final authority to which reference should be made is Levy v The State of Victoria [1997] HCA 31; 189 CLR 579. That was a case in which the substance of the proceeding concerned the validity of a regulation of the State of Victoria. It was argued that the regulation was invalid because it impeded freedom of communication and the legislative powers of the Victorian Parliament so to legislate was limited (by implication) by the Australian Constitution. The argument raised considerations of freedom of communication of the kind litigated and determined in Lange v Australian Broadcasting Corporation [1997] HCA 25; 189 CLR 520 and Theophanous v The Herald and Weekly Times Ltd [1994] HCA 46; 182 CLR 104 and the correctness of those decisions. These issues significantly affected, for example, media organisations potentially subject to defamation actions. There, organisations were therefore perceived to have an interest in urging a particular construction of the law of defamation and any limitations on that law imposed by reason of implied freedoms to be read in the Constitution. Accordingly, a number of such organisations, an industrial organisation, and The Australian Press Council applied for leave to make submissions as interveners or as amici curiae. Brennan CJ noted that the jurisdiction to permit non-party intervention was not challenged. Nevertheless, his Honour counselled caution in its exercise. The Chief Justice said: "…a non-party whose interests would be affected directly by a decision in the proceeding – that is, one who would be bound by the decision albeit not a party – must be entitled to intervene to protect the interest liable to be affected … But the legal interests of a person may be affected in more indirect ways than by being bound by a decision. They may be affected by operation of precedent – especially a precedent of this Court – or by the doctrine of stare decisis … Ordinarily, such an indirect and contingent affection of legal interests would not support an application for leave to intervene. But where a substantial affection of a person's legal interests is demonstrable (as in the case of a party to pending litigation) or likely, a precondition for the grant of leave to intervene is satisfied. Nothing short of such an affection of legal interests will suffice." (citations omitted) 27 His Honour then said: "However, where a person having the necessary legal interest to apply for leave to intervene can show that the parties to the particular proceeding may not present fully the submissions on a particular issue, being submissions which the Court should have to assist it to reach a correct determination, the Court may exercise its jurisdiction by granting leave to intervene. The grant may be limited, if appropriate, to particular issues and subject to such conditions, as to costs or otherwise, as will do justice as between all parties. In that situation, intervention may prevent an error that would affect the interests of the intervener." (In that case leave was granted to the media organisations to intervene but not to the industrial organisation. It appears that The Australian Press Council was permitted to make submissions as amicus.) 28 Senior counsel for the Attorney General referred to decisions of New Zealand (Fang & Ors v Jiang & Ors [2007] NZAR 420) and Canadian (Bouzari & Ors v Islamic Republic of Iran (2002) 124 ILR 428) courts in which leave was granted to Attorneys General to intervene in cases concerning sovereign immunity. In Fang, as in the present case, the substantive proceeding was brought by a plaintiff against former members of the Government of the PRC, making allegations of a similar kind to those here made. The purpose of the reference was to show that leave of the kind here sought has been made in that jurisdiction. However, so far as the report shows, there was no opposition to the leave sought by the New Zealand Attorney General and the issue was not litigated. Similarly, Bouzari was a decision of the Ontario Superior Court of Justice of Canada on a torture claim sought to be brought against the Islamic Republic of Iran. The report shows that the Attorney General of Canada was granted leave to intervene and present evidence with respect to international law and the constitutional issue, and Amnesty International (Canadian section) was given leave to intervene and present argument. However, again, the report does not suggest that there was any opposition to the grant of leave, and the issue was not litigated. In neither case is there any discussion of the principles on which leave might be granted, or the reasons for its grant. 29 I accept that caution must be exercised in determining an application for leave by a non-party to intervene in proceedings. It is generally undesirable that the boundaries of litigation should be expanded by the incorporation of parties who are not engaged in the dispute which forms the substance of the proceedings. It is important not to lose sight of the fact that a plaintiff is, generally, entitled to lay out the playing field, and the defendant to limit, or, occasionally, expand it. It is, generally, not for others to intrude upon that playing field. 30 However, I have not overlooked that, in Levy, two points emerge. The first is that the interests of a non-party may be affected or potentially affected by a decision; where that is established, in the view of Brennan CJ, the pre-condition for the grant of leave to intervene is satisfied. The second point that emerges from Levy is that leave to intervene may be granted where it can be seen that the parties to the particular proceeding may not fully present the submissions on a particular issue, where such submissions would assist the court to reach a correct determination. Axiomatically, that is so where one party has not appeared and has not presented argument. 31 In these circumstances the Attorney General of the Commonwealth is in a position to assist the Court to reach a correct determination of important matters of jurisdiction. He is in a position to guide the Court in respect of the correct application of the FSI Act, for example. 32 Further, by reason of the unique position of the Australian Government in respect to the sovereignty of foreign countries, it is in a position, through its representative, the Attorney General, to guide the Court in that respect also. The case falls within the special category in which the prerogatives of government are involved, permitting the Attorney General to intervene, whether by right or by leave. 33 These matters are important. While it is not for this Court to inquire into why the defendant has chosen not to enter an appearance or file a defence, the fact is that, in respect of matters of significance, the Court is, absent the intervention of the Attorney General, without a contradictor. Apart from the question of intervention, the particular matter for determination is whether default judgment ought to be entered. That is no light matter, and ought not to be taken unless all necessary preliminary conditions have been satisfied. Without the intervention of the Attorney General this Court could be left in the dark as to some essential step that is a precondition to entry of judgment. The Court depends upon the assistance of parties, through their counsel, and within the conventions of the adversary system, to arrive at a correct result. 34 For these reasons I have come to the view that the Attorney General ought be granted the leave that he seeks. The plaintiffs' notice of motion: default judgment 35 I have mentioned above that service was purportedly effected on two occasions. These were 7 December 2006 and 8 December 2006. Two affidavits depose to the circumstances in which the statement of claim was delivered to the defendant. 36 Kelly Zhan, a journalist, deposed that on 7 December 2006 she was present at a media event at a venue, "The Dome", Showground Road, Olympic Park, in her capacity as a freelance journalist. The defendant was also present. She said that she spoke to the defendant by name, to which he responded, and she handed him a white manilla envelope containing "all the court documents" she intended to serve on him. Included in this was a sealed copy of the statement of claim. The defendant refused to accept the envelope. She pushed it up against his chest. He entered the rear section of a motor vehicle; she threw the envelope into the vehicle. The envelope was then thrown out of the car and onto the pavement. 37 Bai Shu Hui deposed that, the following day, he/she was present in the lobby at the Hilton Hotel in Sydney. The defendant was also present. Mr/Ms Bai called the defendant's name in Mandarin and said: "… Chen Shaoji, this is the statement of claim for you." And personally passed the white manilla envelope containing "the documents" to him. The defendant pushed the envelope back to Mr/Ms Bai, swore in Mandarin, and continued walking. 38 The affidavit of Ms Zhan is supported by an affidavit of Yue Sun, who very substantially confirms the account given by Ms Zhan. 39 Although, in each case, the deponent deposed to have "duly served" a sealed copy of the statement of claim on the defendant and made other reference to delivery of "the documents", it is unclear what, if any, documents besides the statement of claim were contained in the envelopes. For reasons that will appear, this is, in this case, not insignificant. 40 Section 27 of the FSI Act provides: "(1) A judgment in default of appearance shall not be entered against a foreign State unless: (a) it is proved that service of the initiating process was effected in accordance with this Act and that the time for appearance has expired; and (b) the court is satisfied that, in the proceeding, the foreign State is not immune. (2) A judgment in default of appearance shall not be entered against a separate entity of a foreign State unless the court is satisfied that, in the proceeding, the separate entity is not immune." 41 A "separate entity" in relation to a foreign State is defined in s 3 as: "… a natural person (other than an Australian citizen) … who … (a) is an agency or instrumentality of the foreign State; and (b) is not a department or organ of the executive government of the foreign State." 42 Part 3 of the FSI Act is concerned with service and judgments. Section 24(1) provides: "24 Service through the diplomatic channel (1) Initiating process that is to be served on a foreign State may be delivered to the Attorney-General for transmission by the Department of Foreign Affairs to the department or organ of the foreign State that is equivalent to that Department. (2) The initiating process shall be accompanied by: (a) a request in accordance with Form 1 in the Schedule; (b) a statutory declaration of the plaintiff or applicant in the proceeding stating that the rules of court or other laws (if any) in respect of service outside the jurisdiction of the court concerned have been complied with; and (c) if English is not an official language of the foreign State: (i) a translation of the initiating process into an official language of the foreign State; and (ii) a certificate in that language, signed by the translator, setting out particulars of his or her qualifications as a translator and stating that the translation is an accurate translation of the initiating process. (3) Where the process and documents are delivered to the equivalent department or organ of the foreign State in the foreign State, service shall be taken to have been effected when they are so delivered. (4) Where the process and documents are delivered to some other person on behalf of and with the authority of the foreign State, service shall be taken to have been effected when they are so delivered. (5) … (6) … (7) The time for entering an appearance begins to run at the expiration of 2 months after the date on which service of the initiating process was effected. (8) …" 43 The certificate of the Minister, to which I have referred above, establishes that service of this statement of claim must comply with the requirements of the FSI Act. Plainly, service was not effected in accordance with the requirements of the FSI Act. Section 27 operates to preclude entry of default judgment in those circumstances. 44 For these reasons the plaintiffs' notice of motion must be dismissed. 45 The orders I make are: On the notice of motion filed on behalf of the Attorney General for the Commonwealth of Australia: (i) leave granted to intervene in the proceedings; (ii) in the first instance, leave limited to making submissions concerning the procedures for effecting service of process where the Foreign States Immunities Act 1985 is applicable. On the notice of motion filed on behalf of the plaintiffs: (i) the notice of motion is dismissed. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. 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