NZ International Commercial Dispute Memorandum

Your firm acts for NZ Ltd. Please draft a memorandum for your partner, in line with the partner’s instructions to you set out in (a)-(d) below.

NZ Ltd is a New Zealand company that is involved in two commercial disputes: one with Ruritania Inc, a Ruritanian company, and one with Pipland Inc, a Pipland company.

The dispute with Ruritania Inc is a contractual dispute. NZ Ltd has brought proceedings in New Zealand against Ruritania Inc for breach of contract. NZ Ltd served, or purportedly served, Ruritania Inc at its head office in Ruritania under r 6.27 of the High Court Rules. Ruritania Inc has objected to the New Zealand court’s jurisdiction under r 5.49. Its objection is based on a rule of Ruritanian law (“the Ruritanian service rule”) that states: “foreign proceedings may not be served on parties in Ruritania except in accordance with the procedures of the Hague Service Convention (if the foreign country is a party to the Convention)”.

The dispute with Pipland Inc involves a misrepresentation allegedly made by NZ Ltd at a business meeting in New Zealand. Pipland Inc has brought proceedings against NZ Ltd in Pipland.

Your partner says to you:

(a) What are the implications of the Ruritanian service rule, if any, for our proceedings against Ruritania Inc? Assume that there are no (other) jurisdictional barriers to our claim (ie the court would assume jurisdiction over Ruritania Inc based on the requirements in r 6.27 and 6.29). Please note that Ruritania Inc has obtained expert evidence on the meaning of the Ruritanian service rule as a matter of Ruritanian law. We are not interested at this stage in contesting the evidence, and you can assume that, for the purposes of Ruritanian law, the rule means what it says.

(b) I am worried that Pipland Inc will be able to obtain evidence from Ms Smith for use in the Pipland proceeding. Ms Smith is an independent consultant who was at the business meeting that is the source of the dispute.

(i) Could she be forced to give evidence for use in the Pipland proceeding as a matter of New Zealand law? In other words, could a New Zealand court require her to give such evidence in the Pipland proceeding?

(ii) Would the New Zealand court apply New Zealand law to determine questions of relevance, admissibility etc?

(c) Any Pipland judgment against our client will be enforceable in New Zealand (and potentially elsewhere). We are considering advice to the client whether it is time to render itself judgment proof by shifting assets to a country where the judgment would not be enforceable. We may have to act fast if there is a chance that Pipland Inc will obtain a freezing order from the New Zealand court in aid of the Pipland proceeding. Would the New Zealand court have jurisdiction to make such a freezing order, in relation to the client’s assets located in New Zealand and in other countries?

(d) Please briefly explain in your memo how you found the relevant authorities and/or how you confirmed that they are the most relevant authorities, so that I know I can trust your research.

Experts Answer on Above Law Questions

Implication of the Ruritanian service rule

According to the Ruritanian service rule, all the foreign proceedings should be served through the procedures of the Hague service convention where applicable. A service can be regarded as invalid under the Ruritaninal law if there is a need to comply with the convention but the documents are served directly under the rule 6.27 instead. The New Zealand court can still consider jurisdiction under Rules 6.27 and 6.29m but the defective service could make the enforcement judgement difficult under the Ruritania rules.

Can Ms Smith be compelled to give evidence

With respect to the use of Pipland proceedings, Ms Smith is required to provide evidence on request of New Zealand Court, provided such request is made through the appropriate judicial assistance procedures.

Which law applies?

The law that is applicable is New Zealand procedural law in determining issues in relation to relevance, admissibility, privilege and the manner in which the evidence is collected.

Can the New Zealand court grant a freezing order

Yes the New Zealand court can grant a freezing order in order to prevent NZ ltd from disposing of its assets while the Pipland proceedings are ongoing. This order can be in relation to all the assets within New Zealand and overseas with the objective of preserving assets for potential enforcement.

Research methodology

The legal authorities make use of reputable legal research databases such as New Zealand legislation, court decisions and commentary on private international law. The cross checking is performed with respect to high court rules, judicial precedents and legal texts in order to establish that the authorities are current, authoritative and applies to the issues of jurisdiction.

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