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Volumn 47, Issue 3, 1998, Pages 573-598

Bhopal, bougainville and ok tedi: Why Australia's forum non conveniens approach is better

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EID: 85008162771     PISSN: 00205893     EISSN: 14716895     Source Type: Journal    
DOI: 10.1017/S0020589300062187     Document Type: Article
Times cited : (20)

References (144)
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    • at points out that the situation in England is not so clear cut as in the US. He notes that in the decade after the 1978 House of Lords decision in MacShannon, only 8 out of 36 reported cases resulted in the declining of jurisdiction on discretionary grounds
    • Robertson, Idem, at p.428, points out that the situation in England is not so clear cut as in the US. He notes that in the decade after the 1978 House of Lords decision in MacShannon, only 8 out of 36 reported cases resulted in the declining of jurisdiction on discretionary grounds.
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    • For factors that have been included to date in these categories, see
    • For factors that have been included to date in these categories, see Sticlcley, -Conflict of Laws: A Comparative Analysis of the Forum Non Conveniens Doctrines in the USA, the UK and Australia” (1994) 15 Queensland Lawyer 19,22.
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    • at As says, “It may perhaps be noted that such an argument, with its emphasis on not depriving the litigant of his rights… is stronger in the case of defendants regularly served within the jurisdiction than in that of service outside the jurisdiction under a ‘long arm’ provision.” This is certainly true. However, the majority in Oceanic was dearly concerned to avoid the situation under the “most suitable forum” test where, especially in the US, foreign plaintiffs have the odds stacked against them when attempting to sue local defendants. The practical legal question is, what is the greater injustice? Is it where foreign plaintiffs are effectively barred from obtaining proper recovery from local defendants under the “most suitable forum” approach? Or where foreign defendants have little chance of returning cases to their own country under the “clearly inappropriate forum” or more traditional “abuse of process” tests? In the latter situation, presumably the case is still heard-and in the same forum as the forum non conveniens hearing (saving time and money for the litigants) even if not in the defendant's preferred forum; whereas in the former situation, the matter has to be re-litigated in another country, and as Robertson's work shows (see below), in most cases, the plaintiffs simply give up because of the cost in time and money of bringing a different suit in another country
    • As Reynolds, Idem, at p.41, says, “It may perhaps be noted that such an argument, with its emphasis on not depriving the litigant of his rights… is stronger in the case of defendants regularly served within the jurisdiction than in that of service outside the jurisdiction under a ‘long arm’ provision.” This is certainly true. However, the majority in Oceanic was dearly concerned to avoid the situation under the “most suitable forum” test where, especially in the US, foreign plaintiffs have the odds stacked against them when attempting to sue local defendants. The practical legal question is, what is the greater injustice? Is it where foreign plaintiffs are effectively barred from obtaining proper recovery from local defendants under the “most suitable forum” approach? Or where foreign defendants have little chance of returning cases to their own country under the “clearly inappropriate forum” or more traditional “abuse of process” tests? In the latter situation, presumably the case is still heard-and in the same forum as the forum non conveniens hearing (saving time and money for the litigants) even if not in the defendant's preferred forum; whereas in the former situation, the matter has to be re-litigated in another country, and as Robertson's work shows (see below), in most cases, the plaintiffs simply give up because of the cost in time and money of bringing a different suit in another country.
    • Idem , pp. 41
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    • at Robertson notes that there were only three cases actually decided in a foreign forum out of the ISO surveyed, all of which the plaintiff lost
    • Robertson, Idem, at pp.418–420. Robertson notes that there were only three cases actually decided in a foreign forum out of the ISO surveyed, all of which the plaintiff lost.
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    • US Laws in the Rainforest: Can a US Court Find Liability for Extraterritorial Pollution Caused by a US Corporation? An Analysis of Aguinda v. Texaco, Inc
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    • at When the Bhopal matter, returned io the Indian legal system, Union Carbide agreed to pay $US470 million in settlement. Robertson notes that on top of the number of dead (at least 2,660) there were around 40,000 serious injuries. Dividing the S470 million settlement figure among these victims on an equal basis would give them around $I 1,000 each “with nothing left over for less serious injury victims and those who may develop illness in the future”. If less serious injury victims are included, the total number of victims rises to around 205.000. If this number of victims shared the settlement fund equally, they would receive less than $2300 each, again with nothing left over for those who become ill in the future, not to mention future generations
    • Robertson, Boston College Int. & Comp.L. Rev., at p.375. When the Bhopal matter, returned io the Indian legal system, Union Carbide agreed to pay $US470 million in settlement. Robertson notes that on top of the number of dead (at least 2,660) there were around 40,000 serious injuries. Dividing the S470 million settlement figure among these victims on an equal basis would give them around $I 1,000 each “with nothing left over for less serious injury victims and those who may develop illness in the future”. If less serious injury victims are included, the total number of victims rises to around 205.000. If this number of victims shared the settlement fund equally, they would receive less than $2300 each, again with nothing left over for those who become ill in the future, not to mention future generations.
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    • at There were of course those who argued that the Bhopal victims' allocation of between $12,000 and S 10,000 each was perfectly adequate. One of these was who suggested that “The purpose of the Bhopal litigation should not be to make ‘millionaires out of people who live in huts and tents’.”
    • There were of course those who argued that the Bhopal victims' allocation of between $12,000 and S 10,000 each was perfectly adequate. One of these was Cummmgs, Boston College Int. & Comp.L. Rev., at p. 140, n. 157, who suggested that “The purpose of the Bhopal litigation should not be to make ‘millionaires out of people who live in huts and tents’.”
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    • McLachJan, “Conflict of Laws-Forum non Conveniens and Stays of Proceedings” (1990) 64 A.L.I. 219,220.
    • (1990) A.L.I , vol.64
    • McLachJan1
  • 123
  • 124
    • 85022745918 scopus 로고
    • Life after Voth. The Application of Forum Non Conveniens by Australian Courts in Tram-national Proceedings
    • After the Oceanic decision, Australian courts adopted Deane J's “clearly inappropriate forum” test, but there was disagreement on how to apply the test, due to confusion in Oceanic over the onus of proof in “ service ex juris” versus regular service cases see
    • After the Oceanic decision, Australian courts adopted Deane J's “clearly inappropriate forum” test, but there was disagreement on how to apply the test, due to confusion in Oceanic over the onus of proof in “ service ex juris” versus regular service cases (see Harris, “Life after Voth. The Application of Forum Non Conveniens by Australian Courts in Tram-national Proceedings” (1992) Queensland Law Society J. 21).
    • (1992) Queensland Law Society J , pp. 21
    • Harris1
  • 125
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    • Forum Non Conveniens-the Next Chapter
    • In fact, it was this issue that seemed to cause much of the criticism of the Oceanic decision, rather than outright opposition to the “dearly inappropriate forum” test itself. After the High Court in Voth had sorted out the onus of proof question-and had affirmed the “dearly inappropriate forum” approach-criticism of the Australian forum non conveniens doctrine seemed largely to disappear. Except on the part of Pryles, who maintained “there is no good reason for [the High Court in Voth] continuing to acknowledge the relevance of the old formulation in St Pierre”, stating rather forlornly that “We may as well admit that it has been replaced by the formulation of the clearly inappropriate forum test” see This seems to miss the point that Deane J tied the “clearly inappropriate forum” test to the old “oppressive or vexatious/abuse of process” test (i.e. continuation of proceedings would be “oppressive or vexatious” if the forum was “clearly inappropriate”) to ensure the Australian approach did not move too far in the direction of the “most suitable” forum approach, the problems of which Deane J was specifically concerned to avoid
    • In fact, it was this issue that seemed to cause much of the criticism of the Oceanic decision, rather than outright opposition to the “dearly inappropriate forum” test itself. After the High Court in Voth had sorted out the onus of proof question-and had affirmed the “dearly inappropriate forum” approach-criticism of the Australian forum non conveniens doctrine seemed largely to disappear. Except on the part of Pryles, who maintained “there is no good reason for [the High Court in Voth] continuing to acknowledge the relevance of the old formulation in St Pierre”, stating rather forlornly that “We may as well admit that it has been replaced by the formulation of the clearly inappropriate forum test” (see Pryles, “Forum Non Conveniens-the Next Chapter” (1991) 65 A.LJ. 442,451). This seems to miss the point that Deane J tied the “clearly inappropriate forum” test to the old “oppressive or vexatious/abuse of process” test (i.e. continuation of proceedings would be “oppressive or vexatious” if the forum was “clearly inappropriate”) to ensure the Australian approach did not move too far in the direction of the “most suitable” forum approach, the problems of which Deane J was specifically concerned to avoid.
    • (1991) A.LJ , vol.65
    • Pryles1
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    • Ok Tedi: The Law Sickens from a Poisoned Environment
    • Oct
    • Gordon, “Ok Tedi: The Law Sickens from a Poisoned Environment”, Law Society Journal, Oct 1995, p.60.
    • (1995) Law Society Journal , pp. 60
    • Gordon1
  • 128
  • 129
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    • Warnings that the development of the Panguana mine could lead to rebellion on Bougainville were ignored by the Australian government when it approved the project in Apr. 1967 because it was “anxious to smooth the way for Papua New Guinea's independence from Australia by accelerating economic development”. The mine was forced to close in 1989, with the Bougainville conflict becoming “one of Australia's biggest diplomatic headaches” 1 Jan.
    • Warnings that the development of the Panguana mine could lead to rebellion on Bougainville were ignored by the Australian government when it approved the project in Apr. 1967 because it was “anxious to smooth the way for Papua New Guinea's independence from Australia by accelerating economic development”. The mine was forced to close in 1989, with the Bougainville conflict becoming “one of Australia's biggest diplomatic headaches” (The Australian. 1 Jan. 1998).
    • (1998) The Australian
  • 130
  • 131
    • 85022783826 scopus 로고    scopus 로고
    • Cummings's reasons for supporting a forum non conveniens dismissal in the Bhopal case
    • See e.g. at
    • See e.g. Cummings's reasons for supporting a forum non conveniens dismissal in the Bhopal case, The Australian, at p. 165.
    • The Australian , pp. 165
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    • The Ok Tedi Mine Dispute
    • Nov.
    • Moshinsky, “The Ok Tedi Mine Dispute”. Law Institute Journal, Nov. 1995, 1114, 1117.
    • (1995) Law Institute Journal
    • Moshinsky1
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    • In the Ok Tedi case BHP sought, unsuccessfully, to escape the action in Australia by asserting that the Victorian Supreme Court did not have jurisdiction to hear the PNG plaintiffs claims-on the basis, however, of the “Mozambique principle”, i.e. “inasmuch as property of the kind is to be held according to the laws of the country where it is situated, and as the right of granting it is vested in the ruler of the country, controversies relating to such property can only be decided in the state in which it depends”, per
    • In the Ok Tedi case BHP sought, unsuccessfully, to escape the action in Australia by asserting that the Victorian Supreme Court did not have jurisdiction to hear the PNG plaintiffs claims-on the basis, however, of the “Mozambique principle”, i.e. “inasmuch as property of the kind is to be held according to the laws of the country where it is situated, and as the right of granting it is vested in the ruler of the country, controversies relating to such property can only be decided in the state in which it depends”, per Lord Halsbury in British South Africa Co. v. Companhia de Mozambique [1893] A.C. 602,631
    • (1893) A.C
  • 135
  • 136
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    • See at
    • See Rankin, A.C., at pp.221,222.
    • A.C
    • Rankin1
  • 137
    • 0039206281 scopus 로고    scopus 로고
    • The settlement included SA400 million for construction of a tailings containment system and up toIAlSOmillion compensation for environmental damage 25 Mar.
    • The settlement included SA400 million for construction of a tailings containment system and up toIAlSOmillion compensation for environmental damage: The Australian, 25 Mar. 1997.
    • (1997) The Australian
  • 138
    • 85022835170 scopus 로고
    • Moreover, under the Australian test, it is possible that the US courts may not have decided that a case by the Indian victims against the US-based parent company even had the strongest connection with India, since the place “where the parties respectively reside or carry on business” is an important factor in deciding this. See part of Lord Goff of Chievely's judgment approved by the High Court in Voth as providing “valuable assistance” on the relevant connecting factors
    • Moreover, under the Australian test, it is possible that the US courts may not have decided that a case by the Indian victims against the US-based parent company even had the strongest connection with India, since the place “where the parties respectively reside or carry on business” is an important factor in deciding this. See Spiliada v. Cansulex [1987] A.C. 460,478, part of Lord Goff of Chievely's judgment approved by the High Court in Voth as providing “valuable assistance” on the relevant connecting factors
    • (1987) A.C
  • 140
    • 85022758112 scopus 로고    scopus 로고
    • at
    • Cummings, A.C., at p.111.
    • A.C , pp. 111
    • Cummings1
  • 141
    • 85022863871 scopus 로고    scopus 로고
    • See
    • See A.C.
    • A.C
  • 142
    • 85022823818 scopus 로고    scopus 로고
    • at
    • Cummings, A.C., at p.135, n.132.
    • A.C , Issue.132 , pp. 135
    • Cummings1
  • 143
    • 0002053656 scopus 로고    scopus 로고
    • In this context, there is an interesting contrast with US-led calls at the time of the first World Trade Organization ministerial meeting in Singapore in Dec. 1996 for the WTO to adopt “internationally recognized core labour standards”. The aim of the US was to prohibit child labour and other labour practices in developing countries which are not legal or acceptable in first world nations. The meeting rejected this move, with strong doubts among developing nations about the sincerity of US objectives. (As the Ministerial Declaration stated, “We reject the use of labour standards for protectionist purposes, and agree that the comparative advantage of countries, particularly low-wage developing countries, must in no way be put into question.” See 13 Dec. At the Singapore meeting there were, naturally enough, no references to the US forum non conveniens doctrine. But WTO members might well have noted the inconsistency between the international trade policy of the US and the US forum non conveniens approach, which does little to promote the accountability of American companies for overseas industrial practices not acceptable in the US itself
    • In this context, there is an interesting contrast with US-led calls at the time of the first World Trade Organization ministerial meeting in Singapore in Dec. 1996 for the WTO to adopt “internationally recognized core labour standards”. The aim of the US was to prohibit child labour and other labour practices in developing countries which are not legal or acceptable in first world nations. The meeting rejected this move, with strong doubts among developing nations about the sincerity of US objectives. (As the Ministerial Declaration stated, “We reject the use of labour standards for protectionist purposes, and agree that the comparative advantage of countries, particularly low-wage developing countries, must in no way be put into question.” See WTO Singapore Ministerial Declaration, 13 Dec. 1996.) At the Singapore meeting there were, naturally enough, no references to the US forum non conveniens doctrine. But WTO members might well have noted the inconsistency between the international trade policy of the US and the US forum non conveniens approach, which does little to promote the accountability of American companies for overseas industrial practices not acceptable in the US itself.
    • (1996) WTO Singapore Ministerial Declaration
  • 144
    • 0002053656 scopus 로고    scopus 로고
    • at The Australian government has passed legislation to control some specific overseas activities by its citizens, for example the Crimes (Child Sex Tourism) Act, under which a prominent Australian diplomat has recently been charged. As points out, however, it is unlikely that the Commonwealth would legislate to regulate the overseas activities of Australian companies. From a national policy point of view, this increases the importance of an effective legal doctrine which performs this function
    • The Australian government has passed legislation to control some specific overseas activities by its citizens, for example the Crimes (Child Sex Tourism) Act, under which a prominent Australian diplomat has recently been charged. As Spry, WTO Singapore Ministerial Declaration, at p.4, points out, however, it is unlikely that the Commonwealth would legislate to regulate the overseas activities of Australian companies. From a national policy point of view, this increases the importance of an effective legal doctrine which performs this function.
    • WTO Singapore Ministerial Declaration , pp. 4
    • Spry1


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