Neilson v Overseas Projects Corporation of Victoria Ltd

What "the lex loci delicti" refers to. Gummow and Hayne JJ restated that the double actionability rule has no application to intranational or foreign torts and that no exception, flexible or otherwise, is recognised to the rule that the lex loci delicti applies to substantive questions ([64]). In their reasons, choosing the lex loci delicti to govern questions of substance in a foreign tort "is not to be confined to reference to what the forum classifies as the domestic law of that jurisdiction" ([102]). Their Honours' conclusion is framed for a particular kind of case: "At least where the choice of law rules of the lex loci delicti depend upon a connecting factor other than place, such as nationality or domicile, the lex loci delicti is the whole of the law of that place." ([102]). They drew two consequences: if the foreign jurisdiction would choose to apply the law of the forum, the forum applies its own law, and if it would look to a third jurisdiction, the forum looks to and applies that jurisdiction's law ([103]). In this case they understood Art 146 as a once for all reference out of Chinese law into the law of the country of nationality or domicile, not as requiring regard to Australian choice of law rules ([131]). They said that no concluded answer was called for on this occasion on whether a reference by the foreign law to the law of the country of nationality or domicile includes that country's own choice of law rules, or on what follows where that country is a federation ([128]-[129], [135]).

The other Justices wrote separately. Gleeson CJ doubted the argument that Zhang directed the court to the Chinese General Principles but excluding Ch VIII and was "unable to accept that conclusion" ([13]); he said that Australian law does not accept a flexible exception to its rule that the lex loci delicti governs foreign torts ([16]). Heydon J held that "in this case at least the Australian rules of the conflict of laws refer to the entirety of the lex loci delicti" ([278]), said the problem was to be solved by construing Art 146 rather than by a principle of universal or general application ([277]), and distinguished "flexible exceptions" from the consequences of applying the foreign law's own rules ([283]). Callinan J stated the principle in his own terms: the lex loci delicti is applied, but "if the evidence shows that the foreign court would be likely to apply Australian law by reason of its choice of law rules or discretions, then the Australian common law of torts should govern the action" ([261]). Kirby J agreed that Zhang did not require the exclusion of Art 146 and that applying one sentence of it while ignoring another "would be unacceptably arbitrary" ([171], [174]), but held that the appellant had not proved how a Chinese court would apply it, so that the Chinese one-year limitation applied ([207]-[220]). McHugh J held that choice of law rules do not form part of the category of the lex loci delicti's laws that the forum court makes applicable ([39], [59]).

The foreign court's discretion, and proof of foreign law. In the reasons of Gummow and Hayne JJ, the primary judge was wrong to treat Art 146 as permitting him to exercise "a right to choose to apply the law of Australia"; the question was "how, if at all, would a Chinese court exercise the power or discretion given by that Article" ([113]). Gleeson CJ ([15]), Callinan J ([244]) and Heydon J ([274]) also treated what a Chinese court would do as the question, and Kirby J agreed with the majority's identification of the primary judge's error ([191]). Foreign law is a question of fact ([115]). On the limited evidence, Gummow and Hayne JJ held that the trial judge was bound to conclude that Chinese law, applied to these facts, would look to the law of the parties' nationality or domicile, whether the evidence is analysed as deficient (so that the presumption that foreign law is the same as the law of the forum comes into play) or as a complete account of the relevant principles ([124]-[127]). Callinan J presumed that Chinese principles of statutory construction are the same as the Australian ones ([249]), and Heydon J employed Australian principles of construction because there was no evidence of the principles to be applied ([267]). Gleeson CJ found no assistance in the presumption in this case but held Mr Liu's evidence "barely sufficient, but it is just enough" to support the primary judge's conclusion ([16]-[17]). McHugh J held that Mrs Neilson had not discharged the burden of proving that a Chinese court would choose Australian law ([35]-[37]), and Kirby J rejected the presumption as unavailable and held that "Possibilities are insufficient to fill the gap in the evidence" ([203]-[208]).