You are on page 1of 10


Klaus LUECK et al., Plaintiffs-Appellants, v. SUNDSTRAND CORPORATION;  Honeywell Corporation; Hydraulic
Units, Inc., dba Dowty Aerospace;  Messier-Dowty International;  Dehavilland, Inc., Defendants-Appellees.
Plaintiffs appeal the district court's dismissal of their suit on the basis of forum non conveniens.
Plaintiffs, citizens of New Zealand, are victims of an airplane crash in New Zealand, on a New Zealand carrier.
Plaintiffs allege that the radio altimeter of the Ground Proximity Warning System (“GPWS”) malfunctioned
during flight and was a causal factor of the accident.
Defendants, the Canadian manufacturer of the aircraft and the American manufacturers of the GPWS and the
radio altimeter, argued that New Zealand was an adequate alternative forum and that the public and private
factors weighed in favor of dismissal.
The district court agreed with Defendants.
ISSUE: WON The US Courts have jurisdiction over the case
HELD: No, US Courts have no jurisdiction.
· A district court has discretion to decline to exercise jurisdiction in a case where litigation in a foreign forum
would be more convenient for the parties.
In dismissing an action on forum non conveniens grounds the court must examine:  (1) whether an adequate
alternative forum exists, and (2) whether the balance of private and public interest factors favors dismissal.
We have also held that a district court must make a choice of law determination in considering whether to
dismiss the action.
· The district court's decision “may be reversed only when there has been a clear abuse of discretion; where
the court has considered all relevant public and private interest factors, and where its balancing of these
factors is reasonable, its decision deserves substantial deference.” A forum non conveniens determination is
committed to the sound discretion of the district court.
Adequate Alternative Forum A.
A jury trial in the United States on these facts could yield significantly higher awards to Plaintiffs than the
compensation they will receive from the ACC. In this case, Plaintiffs' attorney has candidly admitted that the
impetus for the lawsuit is money:  United States law offers Plaintiffs a greater potential remedy for their losses
than New Zealand law.
The forum non conveniens analysis does not look to the precise source of the plaintiff's remedy, so we will
not require the alternative forum to offer a judicial remedy. Several other courts have found New Zealand's
accident compensation system to provide an adequate alternative remedy. Plaintiffs have not shown that
this type of administrative remedy is so inadequate that it is tantamount to no remedy at all. Although New
Zealand law does not permit Plaintiffs to maintain this exact suit, New Zealand, through its no-fault accident
compensation scheme, has provided and continues to provide a remedy for Plaintiffs' losses. A New Zealand
remedy is unquestionably available here.
The Balance of Public and Private Factors B.
The Private Interest Factors 1.
Courts consider the following private interest factors:

the residence of the parties and the witnesses; (1)

the forum's convenience to the litigants; (2)

access to physical evidence and other sources of proof; (3)

whether unwilling witnesses can be compelled to testify; (4)

the cost of bringing witnesses to trial; (5)

the enforceability of the judgment;  and (6)

“all other practical problems that make trial of a case easy, expeditious and inexpensive.” (7)

Defendants, on the other hand, focus on the evidence relating to the crash itself and Plaintiffs' ongoing
medical care, so they contend that New Zealand is a more convenient forum. Plaintiffs focus on the evidence
relating to the testing of the radio altimeter and GPWS, which occurred in the United States, so they argue
Arizona is a more convenient forum. Plaintiffs and Defendants each find a different forum to be more
convenient because each party focuses on different evidence and witnesses.
We have said previously that a court's focus should not rest on the number of witnesses or quantity of
evidence in each locale. Rather, a court should evaluate “the materiality and importance of the anticipated
[evidence and] witnesses' testimony and then determine[ ] their accessibility and convenience to the forum.”
The district court does not have the power to order the production or appearance of such evidence and
witnesses. Though some of the New Zealand evidence is under Plaintiffs' control, including Plaintiffs' medical
and employment records, many of the New Zealand documents and witnesses are under the control of the
New Zealand government or Ansett. The documents and witnesses in New Zealand, however, are not so
easily summoned to the United States. The documents and witnesses in the United States are all under the
control of Plaintiffs and Defendants, so they can be brought to court, no matter the forum. Although crucial
documents and witnesses exist in both fora, the private interest factors are not in equipoise.
It is clear that evidence important to this dispute exists in both the United States and New Zealand. However,
because the district court cannot compel production of much of the New Zealand evidence, whereas the
parties control, and therefore can bring, all the United States evidence to New Zealand, the private interest
factors weigh in favor of dismissal.
Defendants, who have brought this motion, are willing to cooperate in the production of evidence. If they
are brought into that suit, all the evidence under their control would have to be produced in New Zealand.
Currently, the main difference is that Defendants are not parties to the Ansett suit. Therefore, a significant
number of the same witnesses will be needed in both proceedings and much the same evidence will have to
be presented to both courts. Although Plaintiffs characterize the instant suit as focusing on the GPWS rather
than the accident, the fact is that both this and the Ansett lawsuits revolve around the causes of the accident.
Ansett, though not a party to this suit, controls documents and witnesses that are relevant to this dispute.
Furthermore, as noted above, Plaintiffs are maintaining a suit against Ansett, the carrier, in New Zealand.
The Public Interest Factors
Courts consider the following public interest factors:
1. local interest of lawsuit;
2.the court's familiarity with governing law;
3. burden on local courts and juries
4. congestion in the court;  and
5. the costs of resolving a dispute unrelated to this forum. (5)

Because the local interest in this lawsuit is comparatively low, the citizens of Arizona should not be forced to
bear the burden of this dispute. The accident and its aftermath, including the accident investigation, the
post-investigation activity, and the various legal proceedings including an ongoing criminal probe, have all
received significant attention by the local media. The crash involved a New Zealand airline carrying New
Zealand passengers. Furthermore, the interest in New Zealand regarding this suit is extremely high.
However, this interest is slight compared to the time and resources the district court in Arizona would expend
if it were to retain jurisdiction over this dispute. The citizens of Arizona certainly have an interest in the
manufacturing of defective products by corporations located in their forum. One of the defendants is a
citizen of the chosen forum:  Honeywell, which manufactured the radio altimeter in issue. None of the
remaining plaintiffs are citizens or residents of the United States. The public interest factors weigh against
maintenance of this action in Arizona.
Choice of Law Analysis C.
This court has held that “[b]efore dismissing a case for forum non conveniens, a district court must first make
a choice of law determination.”
The purpose of a choice of law inquiry in a forum non conveniens analysis is to determine if one of these
statutes would apply. Creative Tech., 61 F.3d at 700. 56, “contain special provisions mandating venue in the
United States district courts.” 688(a), and the Federal Employers' Liability Act, 45 U.S.C. § The Jones Act, 46
U.S.C.App. § However, the choice of law analysis is only determinative when the case involves a United States
statute requiring venue in the United States, such as the Jones Act or the Federal Employers' Liability Act. See
Creative Tech., 61 F.3d at 700.
Because “there is no arguably applicable law that would end the forum non conveniens inquiry [in this case],
Where no such law is implicated, the choice of law determination is given much less deference on a forum non
conveniens inquiry. ․ no potentially dispositive choice of law determination need have been made.”

Erie Railroad Co. v. Tompkins

-Tompkins (Plaintiff) was walking along a path next to railroad tracks in Pennsylvania when an object
protruding from a train, which looked like a door struck him. Plaintiff, a citizen and resident of Pennsylvania,
sued Erie Railroad Company (Defendant), the owner of the property, for negligence in federal court for
southern New York, the state of incorporation of Defendant Erie.

Defendant, Erie, argued that its duty to Tompkins must be determined in accordance with
Pennsylvania law. Under Pennsylvania law, persons who use pathways along the railroad right of way are to be
deemed trespassers, and that the railroad is not liable for injuries to undiscovered trespassers resulting from
its negligence unless it be wanton or willful. Hence, Plaintiff is a trespasser. Defendant cited Sec. 341 of the
Federal Judiciary Act.

On the other hand, Plaintiff [Tompkins] denied that any such rule had been established by the
decisions of the Pennsylvania courts, and contended that, since there was no statute of the State on the
subject, the railroad's duty and liability is to be determined in federal courts as a matter of general law2. Under
general law, federal courts are free in the absence of a local statute, to exercise their independent judgment
as to what the law is, and that a railroad company owes to the public [on such permissive pathway] a duty of
care in the operation of its trains.

*The case happened after the Swift v. Tyson case, wherein it held that federal courts exercising
jurisdiction on the ground of diversity of citizenship need not apply the unwritten law of the State as declared
by its highest court; that they are free to exercise an independent judgment as to what the common law of that
state is.

The District Court applied the general law and found for Plaintiff. The Court of Appeals affirmed.
ISSUE: WON the federal courts exercising diversity jurisdiction [involving diversity of citizenship] should
apply the common law of the state.


The doctrine of Swift v. Tyson has revealed its defects, as the benefits expected to flow from the rule
did not accrue. Diversity of citizenship jurisdiction was conferred in order to prevent apprehended
discrimination in state courts against those not citizens of the State. Yet, the Swift v. Tyson doctrine
introduced grave discrimination by noncitizens against citizens of the state. It made rights enjoyed under the
unwritten “general law” vary according to whether enforcement was sought in the state or in federal court,
and the privilege of selecting the court in which the right should be determined was conferred upon
noncitizens. Thus, the doctrine rendered impossible equal protection of the law.
[*Kung sundon daw ang kato na doctrine, unfair daw kay mag depende ra kung asa gi litigate ang case,
if in the local courts of the specific state, common law of that state (from court decisions) would be applied,
but if in federal courts, under the said doctrine, courts are not bound by the common law of the state and may
interpret the case according to general laws. Mao gi abandon, kay murag maka forum shopping ang plaintiff]

Supervision over either the legislative or the judicial action of the States is in no case permissible
except as to matters by the Constitution specifically authorized or delegated to the United States. Any
interference with either, except as thus permitted, is an invasion of the authority of the State and, to that
extent, a denial of its independence." Except in matters governed by the Federal Constitution or by Acts of
Congress, the law to be applied in any case is the law of the State. And whether the law of the State shall be
declared by its Legislature in a statute or by its highest court in a decision is not a matter of federal concern.
There is no federal general common law.

America Online, Inc. v. Superior Court (Mendoza) (2001)

FACTS: A class action was filed by Mendoza for himself and others against AOL (American Online Inc.) seeking
compensatory and punitive damages, injunctive relief, and restitution. The complaint alleges that real parties
are former subscribers to AOL's Internet service who, over the past four years, paid between $5 and $22 each
month for the service. Monthly payments were made by allowing AOL to debit automatically the credit cards
of class members. The class members terminated their subscriptions to AOL but, without authorization, AOL
continued to debit their credit cards for monthly service fees. Mendoza individually alleged that he gave AOL
notice of the cancellation of his subscription in October 1999, but AOL continued to charge monthly fees
against his credit card at least through February 2000, at which time Mendoza cancelled his credit card in
order to stop the debits.

The complaint alleged separate causes of action including violations of California's Unfair Business Practices
Act, violations of California's Consumers’ Legal Remedies Act (CLRA), common law conversion/trespass (third
cause of action), and common law fraud (fourth cause of action). The complaint also prayed that the action
proceed as a class action under Code of Civil Procedure section 382, Civil Code section 1781, and Business and
Professions Code section 17204, and that Mendoza and the class be awarded compensatory and punitive
damages, restitution, prejudgment interest, attorney fees and costs, and a permanent injunction halting AOL's
practice, and requiring it to disseminate corrective notices.
AOL: Motion to dismiss on the ground of inconvenient forum and choice of law provision under the "Terms of
Service" (TOS) agreement entered into between Mendoza and AOL at the time he subscribed to AOL's
proprietary Internet service. Par. 8 thereof provides:

"You expressly agree that exclusive jurisdiction for any claim or dispute with AOL or relating in any way
to your membership or your use of AOL resides in the courts of Virginia and you further agree and
expressly consent to the exercise of personal jurisdiction in the courts of Virginia in connection with
any such dispute including any claim involving AOL or its affiliates, subsidiaries, employees,
contractors, officers, directors, telecommunications providers and content providers...."

Additionally, paragraph 8 contained a choice of law provision designating Virginia law as being applicable to
any dispute between the parties:

"The laws of the Commonwealth of Virginia, excluding its conflicts-of-law rules, govern this Agreement
and your membership.”

Mendoza: The TOS was an unconscionable adhesion contract, and that under applicable rules of contract
construction, the forum selection clause was unenforceable. He described seeing displayed on his home
computer monitor a "densely worded, small-size text that was hard to read on the computer screen." In
addition, Mendoza contended the TOS was unreasonable and unenforceable because it necessarily
required him and the putative class members to relinquish legal rights in derogation of California public

Court denied AOL’s motion finding that: 1) the forum selection clause was unfair and unreasonable
because it was not negotiated, it was contained in a standard form contract, and was in a format that was
not readily identifiable by Mendoza; 2) AOL had failed to carry its burden of proving that the consumer
rights afforded under California law would not be diminished by enforcement of the clause; and 3) the
remedies available to consumers in Virginia were not comparable to those in California.

AOL filed a petition for a writ of mandamus with the court of appeal.

ISSUE: Whether or not the forum selection and choice of law clauses are enforceable.

RULING: NO, the forum selection and choice of law clauses are unenforceable.

On burden of proof
Normally, the burden of proof is on the party challenging the enforcement of a contractual forum
selection clause. However, the lower court assigned the burden of proof to AOL based on its conclusion
that Wimsatt v. Beverly Hills Weight etc. Internat., Inc. controls this case. In Wimsatt, the court noted that
the remedies sought by the franchisees were statutorily enumerated, and were specifically designed to
protect the rights of persons purchasing and operating franchise businesses in this state. These
protections included a non-waiver statute that voids provisions in a franchise agreement purporting to
waive any of the protections under the Franchise Investment Law (FIL). The court reasoned that a
franchise agreement's forum selection clause might subject California franchisees to litigation in a state
that does not provide the same level of legal protections afforded by California law. Under those
circumstances, enforcing the forum selection clause would effectively waive the remedies of California's
FIL, thereby violating the anti-waiver component of that law. Faced with this potential, the burden of
proof was on the franchisor to prove that enforcing the clause would not violate the statutory antiwaiver
provision of the FIL by "diminish[ing] in any way the substantive rights afforded California franchisees
under California law."

In comparing the purpose and remedies afforded to California franchisees under the FIL to those afforded
California consumers under the CLRA, we find identical policy considerations which command shifting the
burden of proof here to AOL, the party seeking enforcement of the forum selection clause, as was done in

On enforceability
The CLRA parallels the Corporate Securities Law of 1968, at issue in Hall v. Superior Court, insofar as the
CRLA is a legislative embodiment of a desire to protect California consumers and furthers a strong public
policy of this state.

Certainly, the CLRA provides remedial protections at least as important as those under the Corporate
Securities Law of 1968. Therefore, by parity of reasoning, enforcement of AOL's forum selection clause,
which is also accompanied by a choice of law provision favoring Virginia, would necessitate a waiver of the
statutory remedies of the CLRA, in violation of that law's antiwaiver provision (Civ. Code, § 1751) and
California public policy. For this reason alone, we affirm the trial court's ruling.

One of the causes of action seeks class action relief under the California Consumers Legal Remedies Act
(CLRA) (Civ. Code, § 1750 et seq.). This act contains a provision that voids any purported waiver of rights
under the CLRA as being contrary to California public policy. Enforcement of the contractual forum
selection and choice of law clauses would be the functional equivalent of a contractual waiver of the
consumer protections under the CLRA and, thus, is prohibited under California law.

We conclude that Virginia law does not allow consumer lawsuits to be brought as class actions and the
available remedies are more limited than those afforded by California law. Accordingly, the rights of
Mendoza and the California consumer class members would be substantially diminished if they are
required to litigate their dispute in Virginia, thereby violating an important public policy underlying
California's consumer protection law. For this independent reason, the forum selection clause is
Sumitomo Bank Ltd v Kartika Ratna Thahir and others and another matter [1992] SGHC 301
Suit No: OS 308/1976
· The plaintiffs (`Pertamina`), an Indonesian state enterprise, were created by Law No 8 of 1971 of the
Republic of Indonesia. Their principal business was and is the exploration, processing and marketing of oil and
natural gas and related projects. Being a dominant economic force in Indonesia at all material times, they also
undertook major economic development projects at the direction of the government of the Republic of
Indonesia and one such project was the construction of the infrastructure facilities for a massive steel works
known as Krakatau Steel at Cilegon, West Java.

Those steel works were owned and eventually operated by a company known as PT Krakatau Steel (`PTKS`)
created on 31 August 1970 by Law No 8 of 1970. For the purposes of these proceedings, the contractors which
constructed the infrastructure and provided the materials and services under several contracts signed in 1973
and 1974 in respect of the steel works and the infrastructure for the industrial site at Cilegon, West Java,
Indonesia were Klockner Industrie Analagen GMBH (`Klockner`) and Siemens AG (`Siemens`). Another was
Pertamina`s involvement in and their payments for the purchases of equipment in relation to two projects in
the Batam Island.
· General Haji Achmad Thahir (`General Thahir`) was employed by Pertamina and their statutory
predecessors. During the period directly and more immediately material to these proceedings he held the
office as the general assistant to the then president director of Pertamina, General Ibnu Sutowo (`General
Sutowo`). He was appointed to that office with effect from 14 October 1968 until 23 July 1976 when he died,
having succumbed to a heart attack. At all material times his salary totalled only about US$9,000 per year. By
para 3 of the reamended statement of claim it is asserted that from at least June 1972 until his death, General
Thahir `was authorized to contract` on behalf of Pertamina and/or by virtue of his position in Pertamina also
on behalf of PTKS `and to deal with all ancillary matters including the negotiation and implementation of
financial arrangements` in connection with principally the Krakatau steel project.

Pertamina further assert that it was within his power and authority to arrange for creditors (including
Klockner and Siemens) of the plaintiffs and PTKS to be paid. The last assertion of fact in para 3 of the
reamended statement of claim is that General Thahir, by virtue of his relationship with General Sutowo, was in
a position of influence with General Sutowo, particularly in relation to matters involving the construction
works and the supply of goods and materials.
· 19 ACU deposits
It turned out that on 23 July 1976, when General Thahir died, there stood as having been deposited with the
Singapore branch of the Sumitomo Bank, 17 separate and discrete ACU deposits denominated in
Deutschmarks, all in the name of `Mr HA Thahir and/or Mrs KR Thahir`; their aggregate was DM53,972,374.12
and as from 23 July 1976 their maturity dates ranged between a few days and just over four months. In
addition, there were two other separate and discrete ACU deposits, one on time deposit to mature on 18
August 1976 and the other on demand, which were denominated in US dollars in the sums of US$593,249.31
and US$608,959.42 respectively. These two ACU deposits totalled US$1,202,208.73.

The expression `Mrs KR Thahir` in all the 19 ACU deposits refers to the first defendant, Kartika Ratna Thahir
(hereinafter called `Mrs Kartika Thahir`) who by her defence alleges that she is the lawful widow of General
Thahir, having lived with him as man and wife since 1969. Secondly, it is common ground (a) that the moneys
in all 19 ACU deposits were, at all material times, in separate designated joint deposit accounts of both
General Thahir and Mrs Kartika Thahir; (b) that the relationship between Sumitomo Bank, Singapore branch of
the one part and General Thahir and Mrs Kartika Thahir of the other part is governed by the law of Singapore
under which their relationship is contractual in nature and they are respectively debtors/creditors with the
attendant obligations and rights; and (c) that barring disputes, of the nature and type as we have seen in these
proceedings, Mrs Kartika Thahir on the death of General Thahir would have become solely entitled to all the
moneys in the 19 ACU deposits.

· Three days after the death of General Thahir, Mr Mustapha Thahir and another brother, both sons of
General Thahir by an earlier marriage, called at the Djakarta representative office of Sumitomo Bank. They
claimed that all the ACU deposits in question belonged to the estate of the deceased.
· On the same day the solicitors of Sumitomo Bank received a letter dated 28 July 1976 from Messrs Drew &
Napier, the solicitors of Mrs Kartika Thahir. The letter pointed out the legal rights of Mrs Kartika Thahir and
the clear and undoubted obligation on the part of the bank to pay Mrs Kartika Thahir.
· Faced with these competing claims, Sumitomo Bank sought interpleader reliefs and commenced these
originating summons on 30 July 1976 under O 17 r 1(1)(a) of the Rules of the Supreme Court 1970 (`the RSC`).
Mrs Kartika Thahir was named as the first defendant and Messrs Abubakar Thahir, Ibrahim Thahir and Faruk
Thahir were named collectively as the second defendants.
· Courts of equity will apply their own rules to determining whether there is an equity. In the present case, it
would be a matter for Singapore law whether there is an equity or not.
· It is observed that many English cases would have English law as the lex causae. One cannot ignore the
realistic possibility of proceedings commenced abroad, or stays of action, in the case of a foreign lex causae. In
the case of the latter, there is the forum non conveniens doctrine. One of the factors determining an
appropriate forum abroad so as to justify a stay is the applicable law.


Conflict of Laws – Choice of law – Restitution – Claim for bribes received by agent – Basis of claim in equity and
not contract – Giving and receipt of bribe as constructive fraud – Obligation to restore bribes governed by law
of country where enrichment occurred


Under the direction of the Government of the Republic of Indonesia, the respondent ("Pertamina"), an
Indonesian state enterprise, undertook to develop a huge industrial complex for steel-making and related
industries. In relation to this development, Pertamina contracted with two German contractors (Siemens and
Klockner) for the provision of power generation equipment as well as for the building and equipping of the
water supply system. General Thahir ("Gen Thahir") was, at this time, employed by Pertamina as general
assistant to the president director of Pertamina. At the date of his death, there stood as having been
deposited in the Singapore branch of Sumitomo Bank ("the bank"), 17 separate and discrete Asian Currency
Unit ("ACU") deposits denominated in Deutsch marks, in the names of "Mr H A Thahir and/or Mrs K R Thahir",
amounting in aggregate to DM53,972,374.12. In addition, there were two other separate and discrete ACU
deposits denominated in US dollars in the sum of US$593,249.31 and US$608,959.42 in their joint names. Mrs
K R Thahir is Mrs Kartika Ratna Thahir, the appellant in this appeal.

After Gen Thahir's death, there were two competing claims. Sons from his earlier marriage claimed the ACU
deposits belonged to the deceased's estate and requested the bank freeze these deposits. The appellant
however demanded payment of certain sums and the balance of the deposits be transferred to her sole name.
The bank sought interpleader relief. Subsequently, Pertamina came into the picture, claiming to be entitled to
the ACU deposits on the ground that they were wrongfully acquired by Gen Thahir by way of bribes (from
Siemens and Klockner). By order made on 12 March 1980, Pertamina was ordered to be the plaintiffs, the
appellant the first defendant, and the two sons representing the deceased's estate, the second defendant.

At the trial below, Lai Kew Chai J held that the 17 ACU deposits denominated in Deutsch marks were bribes
which Siemens and Klockner paid to Gen Thahir but that Pertamina had failed to discharge its legal and
evidential burden of proof as regards the two ACU deposits in US dollars. As such, the bank was to hold these
two deposits pending the outcome of the trial between the appellant and the representative of Gen Thahir's
estate as to who was entitled to that sum. The learned judge also found that Pertamina's claims at law and in
equity were governed by the law of Singapore. The learned judge found that Gen Thahir held the bribes as
constructive trustee for Pertamina and as the appellant was hand in glove with Gen Thahir in his dishonest
schemes and/or was privy to the receipt of the bribes, she also became a constructive trustee.

The appellant appealed against this decision. Following the appeal, Pertamina filed a respondent's notice,
which was in the nature of a cross-appeal against the learned judge's decision on the two ACU deposits
denominated in US dollars. The issues on appeal were (a) whether Pertamina must have a proprietary claim to
the ACU deposits to succeed on the amended first issue; (b) whether the 17 ACU deposits denominated in
Deutsch marks were bribes which Siemens and Klockner paid to Gen Thahir, and if so, whether the appellant
was privy to the receipt of those bribes; (c) whether, as a matter of conflict of laws, Pertamina's claim was
governed by Singapore law or Indonesia law or both; and (d) whether, under the relevant law, Pertamina had
a proprietary claim to the ACU deposits.


Allowing the motion but dismissing the appeal:

(1) The motion to strike out Pertamina's notice was allowed because the notice suffered from a fundamental
defect which was not curable. The notice was in the nature of a cross-appeal, which if successful, would affect
the estate of Gen Thahir in the two deposits denominated in US dollars. However, the representatives of the
estate, a proper party to the cross-appeal, were not a party in the present appeal. Therefore, the cross-appeal
could not proceed and be maintained.

(2) To succeed in interpleader proceedings, Pertamina had to be entitled to the money in the deposits. This
"entitlement" must be founded on some title or proprietary interest in the deposits. A personal claim against
Gen Thahir and/or the appellant will not confer on Pertamina any entitlement that can enable them to
succeed in interpleader proceedings.

(3) The learned trial judge's findings that Pertamina did in fact pay Siemens and Klockner the amounts
alleged and that the ACU deposits denominated in Deutsch marks were proceeds of bribes and/or secret
commissions paid to Gen Thahir by Siemens and Klockner in return for payments made to them by Pertamina,
were unassailable. The findings of fact were arrived at after a detailed examination of the evidence before the
court. The findings were reinforced by the appellant's failure to explain the sources of the deposits and her
admissions to General Moerdani.

(4) The learned trial judge had ample evidence to draw an inference that the appellant was "hand in glove
with Gen Thahir in his dishonest schemes to receive the bribes and that she participated in and/or was privy to
the receipt by Gen Thahir of the bribes."

(5) The basis of Pertamina's claim lay in the fact that equity regarded the giving of a bribe as a constructive
fraud on the part of the giver, and as the bribed agent was necessarily a party to the bribery, it followed that
the receiving of the bribe was equally a constructive fraud on the part of the bribed agent. The principal's
remedies had no contractual origin or connection, but arose in equity. Therefore, the proper governing law
was the law of the country where the enrichment occured, in this case, Singapore law.

(6) Where a servant or agent had realised a secret profit, commission or bribe in the course of his
employment, the term "fiduciary relation" was used in a wide and loose sense and included a case where the
servant gained from his employment a position of authority which enabled him to obtain the sum which he
received. Having regard to the far-reaching extent of Gen Thahir's duties and responsibilities, the trial judge's
conclusion that he was a fiduciary was inevitable.

(7) Pertamina had a claim at common law against Gen Thahir for money had and received. As the appellant
had participated in the receipt of the bribes and knowingly assisted the transfer of moneys that represented
the bribes, Pertamina also had a claim against her for money had and received. Nonetheless, the claim for
money had and received was a personal claim, not a proprietary claim.

(8) Pertamina's claim in equity was irresistible and was clearly a proprietary claim. As soon as a bribe was
accepted by a fiduciary in breach of his duty, he held that bribe on a constructive trust for the person to whom
the duty was owed. Therefore, Gen Thahir held the 17 ACU deposits on a constructive trust for Pertamina. The
appellant, by reason of her complicity and involvement in the transfer of the deposits to the joint account also
became a constructive trustee, and when she became the sole owner of the deposits she continued to hold
them on a constructive trust for Pertamina.

(9) The appellant's arguments that Pertamina must prove that Gen Thahir had received the moneys "secretly
without the knowledge or consent of the principal (ie Pertamina)" were wholly untenable. Pertamina bore and
discharged its burden of proving that the 17 ACU deposits represented bribes paid to Gen Thahir by the
German contractors and the appellant's involvement and complicity in the receipt of the bribes. If the
appellant maintained that these were commissions paid to Gen Thahir with the knowledge or consent of
Pertamina, the burden of proving this must lie with her.