## Facts

- The plaintiffs and defendants each held shares in an Australian proprietary company, Medipac Pty Ltd, which sold medical products.
- In February 1993, the parties executed a written share-transfer agreement requiring the plaintiffs to transfer shares to the defendants for payment.
- The agreement contained an arbitration clause providing for arbitration in Stockholm, Sweden, for disputes about the agreement’s validity or interpretation.
- A dispute arose, and arbitration proceeded in Stockholm; the defendants did not appoint an arbitrator.
- In July 1996, the arbitral tribunal issued an award in favor of the plaintiffs for amounts due under the agreement; the defendants did not pay.
- In April 1999, the plaintiffs commenced proceedings in New South Wales to recognize and enforce the Swedish award under the International Arbitration Act 1974 (Cth).
- The defendants moved to adjourn or stay enforcement, asserting they had commenced proceedings in Sweden challenging the agreement and, effectively, the award; they also raised stamp duty and limitation objections.

## Issues

1. Whether enforcement should be adjourned under International Arbitration Act 1974 (Cth) s 8(8) based on a pending application in Sweden to set aside or suspend the award before a “competent authority.”
2. Whether alleged non-payment of New South Wales stamp duty on the underlying share-transfer agreement warranted a stay or otherwise impeded enforcement of the foreign arbitral award.
3. Whether enforcement was barred or affected by any limitation period, including under Limitation Act 1969 (NSW) s 20.

## Decision

- The court dismissed the defendants’ notice of motion with costs.
- The court refused to adjourn or stay enforcement under s 8(8) because the defendants did not adequately prove a qualifying set-aside/suspension application was pending in Sweden before a competent authority.
- The court rejected a stay based on alleged non-payment of stamp duty, treating the proceeding as enforcement of the award rather than a suit on the underlying agreement.
- The court found no limitation basis to refuse enforcement or grant a stay, given the timing of the award (1996) and the enforcement application (1999).

## Legal Principles

- Under International Arbitration Act 1974 (Cth) s 8(8), a party seeking adjournment of enforcement must establish, with sufficient evidence, that a relevant application to set aside or suspend the award is actually pending in the seat state (or under the law of which the award was made) before a “competent authority.”
- Proceedings directed at the underlying contract (without clear proof they constitute, or trigger, a statutory set-aside/suspension process for the award) do not, without more, justify adjournment under s 8(8).
- Alleged defects or local formal requirements relating to the underlying contract (including stamp duty issues) do not automatically bar recognition and enforcement of a foreign arbitral award where the enforcement claim is founded on the award.
- Enforcement of a foreign arbitral award may be refused or stayed on limitation grounds only if the applicable limitation period has expired; filing within a reasonable post-award timeframe defeats such an objection.

## Conclusion

The court declined to delay enforcement of the Swedish arbitral award because the defendants failed to show a qualifying, pending set-aside or suspension application in Sweden, and collateral objections based on stamp duty and limitation law did not justify a stay; the defendants’ motion was dismissed with costs.


Hallen v. Angledal, [1999] NSWSC 552 (N.S.W. Sup. Ct. 1999)