The case of Siemens AG v Holdrich Investment Ltd  SGCA 23 involved an appeal against the grant of leave to serve an originating process out of jurisdiction. The dispute focused on whether or not Singapore was the appropriate forum to adjudicate the dispute.
The Singapore Court of Appeal took the opportunity to clarify certain issues regarding the test for forum non conveniens. It held that the test involved identifying the most appropriate forum, and not the weighing of the sheer number of factors for and against a certain jurisdiction.
Chao Hick Tin JA, delivering the grounds of decision of the Court of Appeal, also advised that the Court should not be overly detained by the plaintiff’s need to discharge his burden of proof of showing that a certain jurisdiction is or is not the more convenient forum. Rather, the Court should not hesitate to perform a close scrutiny of the facts because in fine-balanced cases, the result could be decided by a single connecting factor.
Here, it was found that Singapore was indeed the proper forum for the dispute to be adjudicated. In the absence of countervailing circumstances and other decisive connecting factors, the Court looked to the parties’ choice of Singapore law as the governing law of the contract at hand.
- Siemens AG, a company incorporated in Germany with its principal place of business there, entered into consultancy agreement (“the Consultancy Agreement”) with Holdrich, a company incorporated in Hong Kong with its principal place of business there. The governing law of the Consultancy Agreement was Singapore law.
- Holdrich claimed commission in respect of its services in helping to secure a contract for PT Siemens Indonesia. However, Siemens AG claimed that the Consultancy Agreement only provided for a commission where contracts were concluded with Siemens AG, and not with any member of the Siemens group.
- In the lower Court, it was held that Singapore was the proper forum, and Holdrich was granted leave to serve originating process on Siemens AG out of jurisdiction.
- Siemens AG appealed against the decision of the lower Court.
Before the Court will grant leave for service out of jurisdiction, the following requirements must be fulfilled:
- The claim must come within the scope of Order 11 rule 1 of the Rules of Court;
- The claim must have a sufficient degree of merit; and
- Singapore must be the proper forum for the dispute to be adjudicated.
Here, the Court had to decide on the third issue – whether Singapore is the proper forum for the dispute at hand.
Holdings Of The Court Of Appeal
The Court of Appeal determined that Singapore was indeed the proper forum for the dispute to be adjudicated, and thus dismissed Siemens AG’s appeal. In so determining, the Court of Appeal laid out a clear analysis of the test for forum non conveniens.
The Court clarified that the purpose of the forum non conveniens analysis is to identify the most appropriate forum in which to try the substantive dispute.
- In doing so, the Court should weigh each connecting factor in light of all the circumstances of the case.
- This is not an exercise in comparing the sheer number of connecting factors, nor is it an exercise in just weighing the connecting factors for and against a certain jurisdiction.
It was also expressed that the Court should not be overly detained by the plaintiff’s need to discharge his burden of proof.
- A plaintiff who seeks leave for service out of jurisdiction bears the burden of proving that the Court from which leave is sought is the proper forum for the substantive dispute to be adjudicated.
- When deciding whether it has jurisdiction over a dispute, the Court begins with the location of the defendant. In this sense, there is a burden of displacing the prima facie weight given to the location of the defendant.
- However, the burden is not strictly one of proof, but of demonstrating the normative weight to be given to each connecting factor. The ease of discharging the burden thus depends on the facts of each case.
The Court also found that a plaintiff seeking leave for service out of jurisdiction need not show that Singapore is “clearly” the most appropriate forum by far. It need only show that Singapore is, on balance and in the final analysis, the most appropriate forum to try the dispute, whether “by a hair or by a mile”.
Here, the connecting factors pointed to diverse jurisdictions. Siemens AG and Holdrich operated from Germany and Hong Kong respectively, while commission was being claimed for a contract concluded between two Indonesian entities.
The Court also made the following observations on some of the factors which might appear to connect the dispute to Germany:
- The fact that several proposed witnesses were physically located in Germany was not material due to the advent of video-link technology. This also applied to the physical location of documentary evidence in Germany.
- The fact that Siemens AG’s evidence would have to be translated into English was ambivalent since the translation would not pose insuperable difficulties. Additionally, Holdrich’s evidence and the documentary evidence exhibited thus far were all in English.
- While German public prosecutors were conducting ongoing investigations into Siemens AG’s agreements, nothing was shown as to how the outcome of such investigations would impact the civil claim in the Singapore proceedings.
The Court thus determined that, given the ambivalence of the other connecting factors, the parties’ choice of Singapore law as the governing law for the Consultancy Agreement assumed a greater degree of importance.
- While issues of Singapore law may be applied by foreign courts, in the absence of countervailing factors, it should preferably be applied by Singapore courts.
- Here, it would be more appropriate for a Singapore court to apply Singapore law as the alternative forum is Germany, a civil law jurisdiction, which could not be said to be able to properly apply Singapore law.
Therefore, in the absence of countervailing factors, the Court accepted that Singapore was the proper jurisdiction, and that Holdrich should be granted leave for service out of jurisdiction.