kuala lumpur regional centre for...

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THE 10TH

LAWASIA INTERNATIONAL MOOT COMPETITION

KUALA LUMPUR REGIONAL CENTRE FOR ARBITRATION

2015

BETWEEN

NEPALESE GOVERNMENT

(CLAIMANT)

AND

AUSTRALIAN NATIONAL MUSEUM

MALAYSIAN NATIONAL MUSEUM

DR. JOHN THOMAS SMITH JR.

(RESPONDENTS)

MEMORIAL FOR THE RESPONDENTS

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TABLE OF CONTENTS

INDEX OF AUTHORITIES ...................................................................................................4

STATEMENT OF JURISDICTION ......................................................................................7

QUESTIONS PRESENTED ...................................................................................................8

STATEMENT OF FACTS ......................................................................................................9

SUMMARY OF PLEADINGS ...............................................................................................11

PLEADINGS ............................................................................................................................13

AUSTRALIAN LAW IS THE APPLICABLE LAW TO GOVERN THE SUBSTANTIVE

MERITS OF THE DISPUTE, THROUGH THE APPLICATION OF THE PRINCIPLE OF

LEX SITUS .............................................................................................................................13

(a) The arbitral tribunal must select an applicable to govern the dispute based on the choice of

law rules ...................................................................................................................................13

(b) The lex situs principle, being the correct conflict of law rule to be applied by the tribunal,

leads to the application of Australian law ...............................................................................13

IN THE ALTERNATIVE, AUSTRALIAN LAW IS THE APPLICABLE LAW TO

GOVERN THE SUBSTANTIVE MERITS OF THE DISPUTE, THROUGH THE

CLOSEST CONNECTION TEST .......................................................................................16

THE RESPONDENTS HAVE TITLE OVER THE STATUE, AND THUS ARE NOT

OBLIGATED TO REPATRIATE THE STATUE BACK TO NEPAL ...........................19

(a) Dr. Smith, has obtained a valid title over the statue from the Nepalese Government, through

the principles of agency. ..........................................................................................................19

(b) Tribhuvan University is a State Organ to the Nepalese Government, and the government is

responsible and liable for its actions .......................................................................................19

(c) The Dean of Tribhuvan University has executed a valid transfer of title of the statue from

Nepal to Dr. Smith ...................................................................................................................23

(d) The statue was not illicitly exported under Nepalese export regulations ..........................25

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THE ARBITRAL AGREEMENT AND AWARD BY THIS TRIBUNAL IS VALID AND

ENFORCEABLE, EVEN IF IT CONTRAVENES NEPALESE LAW…………………..28

PRAYERS FOR RELIEF .......................................................................................................31

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INDEX OF AUTHORITIES

International Conventions and Treaties 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import,

Export, and Transfer of Ownership of Cultural Property .......................................................40

International Law Comission Articles on Responsibility of States for Internationally Wrongful

Acts…………………………………………………………………………………...18, 19, 20

The New York Arbitration Convention on the Recognition and Enforcement of Foreign Arbitral

Awards, 1958 ...........................................................................................................................44

National Laws and Statutes

Arbitration Act 2005………………………………………………………………….....1, 2, 46

Ancient Monument Preservation Act 2013(1956)………………………………..38, 39, 40, 41

Private International Law (Miscellanous Provisions) Act 1995 .............................................13

Protection of Movable Cultural Heritage Act 1986……………………………...35, 36, 37, 43

Restatement (Second) Conflict of Laws 1969 ..........................................................................13

Tribhuvan University Act 2049(1992)………………………………………………..17, 23, 24

Case Law

Ajwa For Food Industries Co (MIGOP), Egypt v Pacific Inter-Link Sdn Bhd & Anor

[2013] 2 CLJ 395 .....................................................................................................................47

Armed Activities on the Territory of the Congo (Democratic Republic of the Congo v Uganda),

ICJ Reports 2005......................................................................................................................10

Attorney General of New Zealand v Ortiz [1984] 2 WLR 809 ................................................42

Autochepalous Greek Orthodox Church of Cyprus v. Goldberg and Feldman Fine Arts, Inc.

717 F. Supp. 1374, 1379 (S.D. Ind 1989)………………………………………………...12, 14

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BC Galleries (Vic) Pty Ltd v Commonwealth of Australia [2012] FMCA 742…………….36

Bank Voor Handel en Scheepvaart v Slatford [1953] 1 QB 248 .............................................3

Cammell v Sewell (1858) 3 H. & N. 617; (1860) 5 H. & N. 728, 157 E.R. 1371………….4, 7

Egyptian International Foreign Trade Co v Soplex Wholesale Supplies Ltd, and PS Refson & Co

Ltd [1985] 2 Lloyd’s Rep 36 (The ‘Rafaella’) .........................................................................28

Foster and Others v British Gas Plc. [1991] 2 AC 306………………………………….22, 26

Freeman and Lockyer v Buckhurst Park Properties (Mangal) Ltd [1964] 2 QB 480,502 ......28

Harding v Wealands [2007] 2 AC 1 ........................................................................................13

Hely-Hutchinson v Brayhead Ltd [1968] 1 QB 549 ................................................................27

International Harvester Co of Australia Pty Ltd v Carrigan’s Hazeldene Pastoral Co (1958) 100

CLR 644 ...................................................................................................................................16

Islamic Republic of Iran v Berend [2007] EWHC 132 (QB)…………………………….....3, 5

Lombard Commodities Ltd. v Alami Vegetable Oil Products Sdn. Bhd [2010] 1 CLJ 137 .....45

Ministry of Defence and Support for Armed Forces of the Islamic Republic of Iran v

Westinghouse Electric Corp. (1996), fn.89 ............................................................................10

Open Type Joint Stock Company Efirnoye (“EFKO”) v. Alfa Trading Ltd [2012] 1 CLJ 323

..................................................................................................................................................48

Panorama Developments (Guildford) Ltd v Fidelis Furnishing Fabrics Ltd [1971] 2 QB 711

..................................................................................................................................................32

Rama Corporation v Proved Tin & General Investments [1952] 2 QB 147 ...........................28

Reynell v Lewis 15 M & W 517 ...............................................................................................28

Winkworth v Christie, Manson, and Woods [1980] Ch.496……………………………...3, 7, 8

Treatises and Textbooks

Cheshire & North’s Private International Law, 10th ed. (1979), p.527 ..................................3

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Dicey and Morris, Conflict of Laws (Sweet and Maxwell 10th ed. 1984) ................................11

Others

Difference Relating to Immunity from Legal Process of a Special Rapporteur of the Comission

on Human Rights, p.87, para. 62 .............................................................................................19

KLRCA i-Arbitration Rules………………………………………………………………..2, 49

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STATEMENT OF JURISDICTION

The Claimant, the Nepalese Government, and the Respondents, the Australian National Museum,

the Malaysian National Museum, and Dr. John Thomas Smith Jr., have agreed to resort to an

arbitration to settle the dispute, pursuant to the Kuala Lumpur Regional Centre for Arbitration

i-Arbitration Rules.

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QUESTIONS PRESENTED

The questions presented in the Moot Problem are as follows:

1. What laws or legal principles establish, (a) Nepal’s right to demand the return of the

statue; and/or (b) the National Museum’s right to retain it:

i) Australian law;

ii) Nepalese law; or

iii) International law and/or (UN) Conventions.

2. If there is a conflict between them, which law and/or Convention should be applied to

this dispute.

3. Will the “outcome” of this legal dispute be governed by which law/convention is applied

and, if so, how.

4. What is the effect on this dispute of the failure to comply with Nepalese law?

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STATEMENT OF FACTS

The parties to the dispute are the Nepalese Government appearing as the Claimant, and the

Australian National Museum, the Malaysian National Museum, and Dr. John Thomas Smith Jr.,

appearing as the Respondents.

One of the respondents, Dr. Smith, was invited to give several lectures at the Central Department

of Sociology/Anthropology at Tribhuvan University. After completing the lectures, the Dean

rewarded Dr. Smith a statue of Lord Vishnu situated between goddesses Lakshmi and Garuda, as

a gift for his services to the University.

Dr. Smith then brought the statue to Australia, where he then donated it to the Australian

National Museum. Subsequently, the Australian National Museum loaned the statue to the

Malaysian National Museum pursuant to a two-year loan agreement. The statue remained in

Malaysia for over a year.

It was then that a Nepalese tourist saw the statue at the Malaysian museum and reported of this

fact to the Nepalese Government upon returning to Nepal. Nepal then asserted that the statue was

stolen and illegally exported out of Nepal. It also demanded the immediate repatriation of the

statue back to Nepal.

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Following this, the parties have agreed to resort to arbitration to settle the dispute and have

agreed to use the KLRCA i-Arbitration Rules as the procedural law of the arbitration. Besides

that, Kuala Lumpur was selected as the seat of arbitration.

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SUMMARY OF PLEADINGS

A. AUSTRALIAN LAW IS THE APPLICABLE LAW TO GOVERN THE

SUBSTANTIVE MERITS OF THE DISPUTE, THROUGH THE

APPLICATION OF THE PRINCIPLE OF LEX SITUS.

Since there is a conflict of law, the arbitral tribunal must select an applicable law to

govern the merits of the dispute based on the conflict of law rules. The lex situs

principle being the most established conflict rule in regards to movable property is the

correct conflict of law rule to be applied by the tribunal leading to the application of

Australian law.

B. IN THE ALTERNATIVE, AUSTRALIAN LAW IS THE APPLICABLE LAW

TO GOVERN THE SUBSTANTIVE MERITS OF THE DISPUTE, THROUGH

THE CLOSEST CONNECTION TEST.

The closest connection test provides that the law of the country which has the most

contact and connection with the parties and the events in the dispute will regarded as

the applicable law. As such, the major transactions involving the statue took place in

Australia, the applicable law is Australian law.

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C. THE RESPONDENTS HAVE TITLE OVER THE STATUE, AND THUS ARE

NOT OBLIGATED TO REPATRIATE THE STATUE BACK TO NEPAL.

Dr. Smith has obtained a valid title over the statue through the operation of the law of

agency, generally, and specifically, by the ostensible authority of the Dean. The Dean

is an agent of the Nepalese Government due to his employment with Tribhuvan

University which is a State Organ to the Nepalese Government. The statue, was not

illicitly exported as it was not registered by th Nepalese Government thus it is not

protected Nepalese Ancient Monument Protection Act. As such, the act of exporting

the statue out of Nepal would not be in contravention with Nepalese export regulations.

D. THE ARBITRAL AGREEMENT AND AWARD BY THIS TRIBUNAL IS VALID

AND ENFORCEABLE, EVEN IF IT CONTRAVENES NEPALESE LAW.

The arbitral award will be enforced in Malaysia, under Malaysian law. Thus even if it

contravenes Nepalese law, it does not contravene Malaysian public policy, and thus the

arbitral award cannot be refused under that exception.

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PLEADINGS

A. AUSTRALIAN LAW IS THE APPLICABLE LAW TO GOVERN THE

SUBSTANTIVE MERITS OF THE DISPUTE, THROUGH THE

APPLICATION OF THE PRINCIPLE OF LEX SITUS.

(a) The arbitral tribunal must select an applicable law to govern the dispute

based on the choice of law rules.

1. There is a conflict of law between the parties, since there has been no express

agreement by the parties on the applicable substantive law to govern the merits of

the dispute.1

2. The applicable to govern the substantive merits of the dispute must be selected by

the tribunal by using the conflict of law rules by virtue of Section 30(4) of the

Malaysian Arbitration Act 20052, which is reaffirmed in Article 35(1) of the

KLRCA i-Arbitration Rules3 as agreed by the parties4.

(b) The lex situs principle, being the correct conflict of law rule to be applied by

the tribunal, leads to the application of Australian law.

1 Arbitration Act 2005, Act 646; Section 30(2)

2 Ibid; Section 30(4)

3 Kuala Lumpur Regional Centre Rules for i-Arbitration

4 Para. 4, Page 3 of the Moot Problem.

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3. The subject matter of this dispute revolves around a movable cultural property

found in Nepal, as the parties are both claiming title over the statue.5 Therefore,

when the subject matter of the dispute concerns movable property, which

includes cultural artifacts,6 the conflict of law rules referred to by the courts

would be the principle of lex situs7 being the lex specialis for such nature of

disputes. Therefore, the Respondents contend that the principle of lex situs

should be applied by this tribunal. This is affirmed by Cheshire and North, in

their text, Private International Law, where it was stated that:

“Therefore, it is now established that the proprietary effect of a particular

assignment of movables is governed exclusively by the law of the country where

they are situated at the time of assignment.”8

4. The principle of lex situs was established in the landmark case of Cammell v

Sewell9, where the court held that any dispute on the transfer of title in regards to

property, shall be determined by the law of the country where the transfer of title

took place, as supported by the statement made by Lord Chief Baron Pollock in

his judgment:

5 Paragraph 3, Page 2 of the Moot Problem.

6 Islamic Republic of Iran v Berend [2007] EWHC 132 (QB); Winkworth v Christie, Manson and Woods [1980]

Ch.496 [hereinafter Winkworth Case]

7 Bank Voor Handel en Scheepvaart v Slatford [1953] 1 QB 248, p257

8 Cheshire & North’s Private International Law, 10th ed. (1979), p.527

9 Cammell v Sewell (1858) 3 H. & N. 617; (1860) 5 H. & N. 728, 157 E.R. 1371.

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“If personal property is disposed of in a manner binding according to the law of

the country where it is, that disposition is binding everywhere.”10

5. The case of Iran v Berend11 illustrates the application of the principle of lex situs

in a cultural property dispute. Judge Eady, presiding in that case has stated that:

“English law has held for many years, in order partly to achieve consistency and

certainty, that where movable property is concerned, title should be determined

by the lex situs of the property at the time when the disputed title is said to have

been acquired”12

6. The law of the last country where an act of transfer over the title took place, is

the lex situs. In this dispute, two transfers of title in regards to the statue took

place. The first transfer occurred in Nepal, when the statue was given to Dr.

Smith by the Dean of the Central Department of Sociology/Anthropology of

Tribhuvan University.13 The second transfer, took place in Australia, when Dr.

Smith donated the statue to the Australian National Museum.14

7. When there are two or more consecutive transfer of title in regards to the same

movable, the law of the country where the most recent transfer took place is

regarded as the lex situs. This is as per the principle in the case of Winkworth v

10 (1860) 5 H. & N. 728, 157 E.R. 1371 at p.638.

11 Islamic Republic of Iran v. Berend, [2007] EWHC 132 (QB)

12 Ibid, at p.8



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Christie, Manson and Woods Ltd15, where the court held that Italian law, as the

law of the country where the goods where the goods were situated at the time of

the delivery, governed the issue on the title over the property. The lex situs rule

was held to apply even though this meant that the plaintiff was deprived of his

title to goods removed from England without his consent and even though the

goods were once again situated in England at the time of the proceedings.16

8. Thus, the last transfer of title in regards to the statue, took place in Australia.

Even though Malaysia is the current physical location of the statue, Malaysian

law is not the lex situs17 as there has been no subsequent act of transfer that took

place in Malaysia, as it is on loan by the Malaysian National Museum18

B. IN THE ALTERNATIVE, AUSTRALIAN LAW IS THE APPLICABLE LAW

TO GOVERN THE SUBSTANTIVE MERITS OF THE DISPUTE, THROUGH

THE CLOSEST CONNECTION TEST.

9. If the tribunal rejects the conflict of law rule of lex situs, then Australian law, as the law

of the country that has the closest and most real connection with the dispute, should be

selected as the applicable substantive law to govern the merits of the dispute.

15 Winkworth v. Christie, Manson, and Woods Ltd. and Another [1980] Ch.496; At p.513, Slade J cited Cheshire &

North’s Private International Law, 10th ed. (1979), p.527.

16 Ibid, at p.512; referred to Cammell v Sewell 5 H. & N. 728, p.742-743

17[1980] Ch.496 at p.505


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10. The closest connection test is one of the most central concepts of private international

law, as was observed by an ICC tribunal observed in 1996:

“The conflict rule which, beyond doubt, has received, on a worldwide basis, the

strongest support, is the so-called ‘closest connection rule’ which indeed is common to

most (national) conflict of laws system.”19

11. The same position was affirmed by Dicey and Morris, in their text, The Conflict of

Laws20, which stated that:

“A particular issue between the parties, may be governed by the law of the country, in

respect of those issues, that has the most significant relationship with the occurrence,

and the parties to the dispute.”

12. The test will look at which legal system has the most contact with all of the parties and

events in the dispute, following which that legal system will be applied to govern the

dispute21.

13. The aforementioned maxim has been applied in arguably two of the most influential

common law jurisdictions, in England and in the United States. English law has

established the principles of the closest connection test, in the Private International Law

Act22 and in the case of Harding v Wealands23. In the case, the court determined that the

19 Ministry of Defence and Support for Armed Forces of the Islamic Republic of Iran v Westinghouse Electric Corp.

(1996), fn. 89.

20 Dicey and Morris, Conflict of Laws (Sweet and Maxwell 10th ed. 1984)

21 Autocephalous Greek Orthodox Church of Cyprus v. Goldberg and Feldman Fine Arts, Inc., 717 F. Supp. 1374,

1379 (S.D. Ind. 1989)

22 Private International Law (Miscellanuous Provisions) Act 1995, Section 12

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substantive law would be the law that was substantially more appropriate to be applied

to the dispute, and applied English law.

14. In the American courts, following the application of the American Second

Restatement24, the facts of which are similar to this dispute. In the case of

Autocephalous Greek-Orthodox Church v Goldberg & Feldman Fine Arts25, the court

applied Indiana law to the dispute. The court, in considering whether to apply either

Indiana, Swiss, or Cyprus law, decided to apply Indiana law as the substantive

governing law to the dispute, because Indiana law, was much more closely connected to

the dispute, since Indiana was the purchaser’s domicile; the purchase was financed by

an Indiana bank; the purchase agreement was made subject to Indiana law, and the

mosaics were present in Indiana.

15. Australian law is the law that is most closely connected to this dispute as two of the

parties to this dispute, Dr. Smith, and the Australian National Museum, are of

Australian character26; the current title to the statue belongs to the Australian National

Museum27; the statue was imported into Australia from Nepal28; the statue is on loan

from Australia to Malaysia,29 and most importantly, the fact that Australia is the

connecting link that connects both Nepal and Malaysia to this dispute, serving as a

23 Harding v Wealands [2007] 2 AC 1

24 Restatement (Second) of Conflicts of Laws 1969, Section 188

25 717 F. Supp. 1374, 1379 (S.D. Ind. 1989)

26 Para. 1, Page 1 and Para. 4, Page 3 of the Moot Problem.




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bridge that connects all of the events and parties within the dispute.30 Therefore,

pursuant to the closest connection test, Australian law is the applicable law to the merits

of this dispute.

C. THE RESPONDENTS HAVE TITLE OVER THE STATUE, AND THUS ARE

NOT OBLIGATED TO REPATRIATE THE STATUE BACK TO NEPAL.

(a) Dr. Smith, has obtained valid title over the statue from the Nepalese Government,

through the principles of agency.

16. The actions of an agent, will legally bind his principal31, which is based on the latin

maxim “Qui fact per alium facit per se” which means that he who acts through another,

does the act himself. The Dean, as an employee of Tribhuvan University, is an agent of

the Nepalese Government because, the Tribhuvan University, is a State Organ to the

Nepalese Government.

(b) Tribhuvan University is a State Organ to the Nepalese Government, and the

government is responsible and liable for its actions.

17. Tribhuvan University is a public authority and a State Organ under the control of the


31 International Harvester Co of Australia Pty Ltd v Carrigan’s Hazeldene Pastoral Co (1958) 100 CLR, 644 at 652

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Nepalese Government, as stipulated under the Tribhuvan University Act32. The preamble

to the Act itself states that it was created as a pious and permanent commemorator to the

King of Nepal, and to serve government functions such as providing education, and

protecting the art and culture of Nepal.

18. The United Nations, in considering whether an organization can be regarded as a State

Organ, and the responsibilities of States towards its Organs, discussed the matter in the

2001 General Assembly33, and drafted the International Law Comission Articles on

Responsibility of States for Internationally Wrongful Acts34.

19. Article 4 of the ILC Articles, referred to by the International Court of Justice35, provide

that a State is responsible for any act of its organs that is inconsistent with the State’s

international law obligations. In Article 4(1) provides that the conduct of any State Organ

shall be considered an act of that State.

20. Therefore, any act of a State Organ is said to be an act of the State itself.36In the

commentary to Article 4 of the ILC Articles, it was stated that even though the provisions

of a state’s internal law characterizes or classifies as independent of the State, this does

32 Tribhuvan University Act 2049(1992)

33 UN GAOR 56th Sess., Supp. No. 10, at 43, U.N. Doc. A/56/10 (2001)

34 Text adopted by the International Law Commission at its fifty-third session, in 2001, and submitted to the General

Assembly as a part of the Commission’s report covering the work of that session (A/56/10).

35 Armed Activities on the Territory of the Congo (Democratic Republic of the Congo v Uganda), ICJ Reports 2005,

para. 160

36 Difference Relating to Immunity from Legal Process of a Special Rapporteur of the Comission on Human Rights,

p.87, para.62

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not mean that they are not organs of the State.37

21. The Tribhuvan University Act is a clear indication that the Nepalese Government

intended Tribhuvan University to be a State Organ, as it prescribes the functions, duties,

and powers of the university38, as well as its organizational structure39, and the amount of

funding it receives from the Nepalese Government40.

22. In the case of Foster v British Gas Plc.41, the House of Lords considered whether or not

the British Gas Corporation was a State Organ to the British Government. The House of

Lords held that the British Gas Corporation was subject to the authority or control of the

state because:

“…British Gas performed its public service of providing a gas supply under the control of

the State. The corporation was not independent; its members were appointed by the State;

the corporation was responsible to the minister acting on behalf of the State, and the

corporation was subject to directions given by the Secretary of State."42

23. Tribhuvan University has fulfilled all of these factors, and should be regarded as a State

Organ of the Nepalese Government. The heads of the University, are members of the

executive branch of the Nepalese Government, showing clearly that there is no separation

of power between the University and the Government of Nepal. The Chancellor, who is

37 International Law Comission Articles on Responsibility of States for Internationally Wrongful Acts, Commentary

to Article 4, para. 11

38 Tribhuvan University Act 2049(1992), Section 5.

39 Ibid, Section 6.

40 Ibid, Section 24.

41 Foster and Others v British Gas Plc. [1991] 2 AC 306

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the head of Tribhuvan University43, is the Prime Minister of Nepal. The Pro-Chancellor,

the second-in-command44, is the Minister of Education and Culture.

24. Tribhuvan University’s members are also appointed by the Nepalese Government, as the

supreme body of the University, that appoints all other members of the University45, is

chaired by the Chancellor and Pro-Chancellor of the University. Tribhuvan University

also receives directions from the Nepalese Government, through its liason with the

Ministry of Education and Culture46, and the University receives direct funding from the

Nepalese Government47, and is exempted from tax48.

25. Finally, the claimants, the Nepalese Government, is also representing the interests of the

Tribhuvan University in this dispute, showing that they are taking responsibility and

liability for its actions49.

26. As Tribhuvan University is a State Organ, it is regarded as an agent to the Government of

Nepal50 inseperable from the Government, and the Government of Nepal is liable for its

actions. The Dean, through his employment with the University, and as representative, is

also an agent to the Government of Nepal.

42 [1991] 2 AC 306 at p.314

43 Tribhuvan University Act 2049(1992), Section 17.




47 Ibid, Section 24(a).


49 Para. C, Page 4 of the Clarifications to the Moot Problem.

50 [1991] 2 AC 306

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(c) The Dean of Tribhuvan University has executed a valid transfer of title of the statue

from Nepal to Dr. Smith.

27. The respondent agrees that the Dean has exceeded his authority when he gave the statue

to Dr. Smith, However, due to the application of the principle of ostensible authority, the

Dean’s actions are still binding on the Nepalese Government. The principle of ostensible

authority provides that where a principal represents to a third party that an agent has

authority to act on behalf of the principal, and the third party, in reliance of that

representation, alters their position through dealings with the agent, the principal will be

bound to the third party, even though the agent has exceeded the authority conferred to

him by his principal.51

28. There are three elements that need to be fulfilled, to establish ostensible authority. The

first element, is that there must be a representation from the principal to the third party, in

relation to the agent’s authority.52 A representation can be manifested in a number of

ways, such as words, conduct, job title or a course of dealings, and if the representation

was made in a public manner, it is inferred to have reached the knowledge of the third

party relying on the representation.53 The second element is that there must be reliance on

the part of the third party.54 This reliance must be genuine.55The third element, is that

51 Hely-Hutchinson V Brayhead Ltd [1968] 1 QB 549

52 Freeman and Lockyer v Buckhurst Park Properties (Mangal) Ltd [1964] 2 QB 480, 502

53 Reynell v Lewis 15 M & W 517 at 527

54 Egyptian International Foreign Trade Co v Soplex Wholesale Supplies Ltd, and PS Refson & Co Ltd [1985] 2

Lloyd’s Rep 36 (The ‘Rafaella’)

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there had to have been an alteration of position on the part of the third party56.

29. Since the Government of Nepal has enacted the Tribhuvan University Act, which is a

local legislation, and has published it in the Nepal Gazette, then there is a representation

made by the Nepalese Government, it can be inferred to have reached Dr. Smith, as it is

made in a public manner.

30. Dr. Smith, had relied on the representations made by the Dean, as he maintains that he

received it from a high ranking government official, indicating that he believes the Dean

to be an agent of the Nepalese Government, and therefore relied on the fact that the Dean

was authorized to give the statue to him, and he was authorized to export it.57

31. Dr.Smith then altered his position in reliance of the representation, as he has not received

any other compensation for his services to the University58, and subsequently donated it

to the Australian National Museum. Therefore, since all three elements are established,

ostensible authority is to be applied in this dispute.

32. The extent of an agent’s ostensible authority was discussed in the case of Panorama

Developments v Fidelis Furnishing Fabrics59, where the court held that the acts of a

55 Rama Corporation v Proved Tin & General Investments [1952] 2 QB 147

56 Egyptian International Foreign Trade Co v Soplex Wholesale Supplies Ltd, and PS Refson & Co Ltd [1985] 2

Lloyd’s Rep 36

57 Para. E, Question 3, Page 3, of the Third Clarifications to the Moot Problem.


59 Panorama Developments (Guildford) Ltd v Fidelis Furnishing Fabrics Ltd [1971] 2 QB 711

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company secretary, acting as representative to the company, would legally bind the

company to his actions, as it was within the usual authority of the secretary to do so.60

33. Although the the Tribhuvan University was only borrowing the statue from the Chauni

Museum61, the principle of ostensible authority provides that the Dean’s actions are still

binding on his principal, the Nepalese Government, who is the true owner of the statue,

and it would not be unjust for the tribunal to force the Nepalese Government as the

principal, to take responsibility for the acts of its agent, the Dean.

34. This is because, the Dean as an employee of Tribhuvan University, is considered to have

the usual authority under the Tribhuvan University Act to manage and dispose with

property that belongs to the University, and this was not disputed in the Moot

Problem.62Thus, Dr. Smith has obtained a valid and enforceable title over the statue, from

the Nepalese Government, through the acts of their agent, the Dean.

(d) The statue was not illicitly exported under Nepalese export regulations.

35. In Australia, the Protection of Movable Cultural Heritage Act (PMCH)63, governs the

protection of cultural property within Australia. For an action for repatriation, Section

14(1) prescribes that, when a protected object of a foreign country has been illegally

60 Ibid, at p.443

61 Part II, Para. A, Page 1 of the Further Clarifications to the Moot Problem.

62 Part II, Para. B, Page 2 of the Further Clarifications to the Moot Problem.

63 Protection of Movable Cultural Heritage Act 1986, Act No.11, 1986. (PMCH)

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exported from that country and imported into Australia, it is liable for repatriation back to

the country.

36. However, Section 14(1)(a) states that it must fall within the scope of a protected cultural

object according to the law of that country, and Section 14(1)(b) states that it must be

illegally exported according to the laws of that country.

37. As in the case of BC Galleries (Vic) Pty Ltd v Commonwealth of Australia,64 the court

rejected the claim of repatriation of the cultural property back to China, because the

objects were not exported illegally under Chinese export laws, and therefore not liable for

repatriation under Section 14(1) of the PMCH.

38. Repatriation of statue under the PMCH, depends on whether the export by Dr. Smith was

illegal under the Nepalese Ancient Monument Preservation Act (AMPA)65Under Section

2(b), protected cultural property are defined as historical objects over 100 years old. If it

is below 100 years old, it is regarded as curio, under Section 2(c), and are not defined as

protected cultural property.

39. Section 13(1) of the Act, which provides that an archeological object, more than 100

years old, as notified in the Nepal Gazette, cannot be exported out of Nepal without prior

permission and permit from the Nepalese Government. However, archeological objects

under 100 years old, which are curio, do not require a permit to be exported out of Nepal,

and does not fall within the export restriction provided by Section 13(1).

64 BC Galleries (Vic) Pty Ltd v Commonwealth of Australia [2012] FMCA 742

65 Ancient Monument Preservation Act 2013 (1956) (AMPA)

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40. Under the Act, it is mandatory for an archeological object over 100 years old to be

registered, pursuant to Section 13(2) of the Act, for it to be recognized as a protected

cultural object, and for it to fall under the export restriction, pursuant to Article 6 of the

1970 UNESCO Convention66.

41. The Nepalese Government, the Chauni Museum, or Tribhuvan University have never

registered the statue, or produced any proper documentation over the statue67, even

though it has been in their possession for a long period of time, which results in the

artefact not being protected under the AMPA, as it could be regarded as curio. This is

reinforced by the fact that the Nepalese Government did not even notice that it was

missing from their inventory, as it was only discovered almost a year after it was missing,

by a Nepalese tourist in Malaysia.68

42. The Nepalese Government are in breach of their own export laws, and their obligations

under the UNESCO Convention. Because of their negligence, they cannot request for the

repatriation of the statue, as per the case of Attorney General of New Zealand v Ortiz,69

where the claim by New Zealand was rejected by the House of Lords, as they have failed

to abide by their own Historical Articles Act of 1962, which requires seizure of the

cultural property by the authorities, before a claim of repatriation can succeed.

66 Article 6 of the 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export

and Transfer of Ownership of Cultural Property.

67 Part II, Para. B, Page 2 of the Further Clarifications to the Moot Problem.

68 Para. C, Page 1, Question 3 of the Third Clarifications to the Moot Problem.

69 Attorney General of New Zealand v Ortiz [1984] 2 WLR 809

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43. The Nepalese Government cannot rely on Section 14 of the PMCH to repatriate the

statue, as the statue does not fall within the definition of a protected cultural object under

the AMPA, and it was not illegally exported. Thus, the respondents have no obligation to

repatriate the statue back to Nepal.

D. THE ARBITRAL AGREEMENT AND AWARD BY THIS TRIBUNAL IS VALID

AND ENFORCEABLE, EVEN IF IT CONTRAVENES NEPALESE LAW.

44. The arbitral agreement and award, will still be valid and enforceable, even if it

contravenes Nepalese law. The issue on whether the award contravenes a particular law,

falls within the public policy exception provided by the New York Convention on the

Recognition of Foreign Arbitral Awards.70 Article V(2)(b) of the New York Convention

provides that the enforcement of an arbitral award may be rejected under the ground that

it contravenes the public policy of the enforcing country.71

45. Malaysia is the country where the arbitral award will be enforced, as the Malaysian

National Museum is the current possessor of the statue, and Malaysia is the current

location of the statue.72In the case of Lombard Commodities Ltd. v Alami Vegetable Oil

Products Sdn. Bhd73, the Federal Court held that the seat of arbitration was the place

where challenges to an arbitral award were to be made.

70 The New York Arbitration Convention on the Recognition and Enforcement of Foreign Arbitral Awards, New

York, 10 June 1958.

71 Ibid, Article V(2)(b)


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46. Thus, even if Nepalese law is breached, the courts of Malaysia will only reject the award

if it is in contravention of Malaysia’s public policy, under the public policy exception

under Section 39 of the Malaysian Arbitration Act 200574, and in accordance with

Malaysian law.

47. Malaysian courts, have narrowly construed the public policy exception, in the case of

Ajwa For Food Industries Co (MIGOP), Egypt v Pacific Inter-Link Sdn Bhd &

Another75, the court has stated that:

“Once parties have agreed to arbitration they must be prepared to be bound by the

decision of the arbitrator and refrain from approaching the court to set it aside. Constant

interference of the court as was the case in the past will defeat the spirit of the

Arbitration Act 2005, which is for all intents and purposes to promote one-stop

adjudication in line with the international practice.”76

48. Furthermore, in the case of Open Type Joint Stock Company Efirnoye (“EFKO”) v. Alfa

Trading Ltd77, the High Court reje cted the defendant’s claim to reject the award on the

basis that it contravenes Malaysian public policy and stated:

“The provisions of s.39, particularly the contravention of public policy argument ought

not to be utilized as a guise to re-open settled matters in the arbitration”.78

73 Lombard Commodities Ltd. v Alami Vegetable Oil Products Sdn. Bhd [2010] 1 CLJ 137

74 Section 39(1)(b)(ii) of the Arbitration Act 2005.

75Ajwa For Food Industries Co (MIGOP), Egypt v Pacific Inter-Link Sdn Bhd & Another [2013] 2 CLJ 395 (CA)

76 Ibid, at p.404, para. 13

77 Open Type Joint Stock Company Efirnoye (“EFKO”) v. Alfa Trading Ltd [2012] 1 CLJ 323

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49. Since the claimant has agreed to an arbitration agreement, under Rule 12(7) of the

KLRCA i-Arbitration Rules, they must adhere to the arbitral award in good faith. Even if

Nepalese law is breached, it would not be in contravention of Malaysia’s public policy

and the claimants must uphold the arbitration agreement.

78 Ibid, at p.344, para. 53

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PRAYER FOR RELIEF

In light of the arguments advanced and authorities cited, the Respondent humbly pleads to this

tribunal:

1. The tribunal applies Australian law to govern the substantive merits of this dispute.

2. The tribunal issues a declaration that the Australian National Museum, has a valid and

enforceable title to the statue.

3. The tribunal rejects the notion that the respondents are obligated to repatriate the statue.

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