B1406-R

THE 9TH LAWASIA INTERNATIONAL MOOT

IN THE THAI ARBITRATION INSTUTE

BANGKOK, THAILAND

2014

BETWEEN

THE INTERNATIONAL COLLECTIVE IN SUPPORT OF TEXTILE WORKERS (CLAIMANT)

AND

SPEAR SHIRTS INCORPORATED

(RESPONDENT)

MEMORIAL FOR RESPONDENT

1

CONTENTS

CONTENTS................................................................................................................................... 2

INDEX OF AUTHORITIES ........................................................................................................ 3

Cases............................................................................................................................................ 3

Statutes/Conventions ................................................................................................................... 3

Reports ........................................................................................................................................ 3

Books ........................................................................................................................................... 4

Articles ........................................................................................................................................ 4

STATEMENT ON JURISDICTION .......................................................................................... 5

QUESTIONS TO BE PRESENTED ........................................................................................... 6

STATEMENT OF FACTS ........................................................................................................... 7

SUMMARY OF PLEADINGS .................................................................................................... 9

RESPONDENT’S PLEADINGS ............................................................................................... 10

I The Law of Thailand should apply to the substance of the dispute ........................................ 10

II The Claimant is not entitled to bring a class proceeding against the Respondent................. 13

III The Respondents are not liable to compensate for the Claimant’s loss ............................... 16

A. The Respondent did not negligently cause the Claimant’s loss ....................................... 16

B. The Respondent is not a joint actor................................................................................... 18

C. The Respondent is not liable under the law of California ................................................ 19

IV Limited damages for the Claimant if action is successful ................................................... 20

CONCLUSION AND PRAYER FOR RELIEF ....................................................................... 22

2

INDEX OF AUTHORITIES

Cases

1. Rodriguez v Bethlehem Steel Corp., 525 P.2d 669, 680 (Cal. 1974).

2. Sheibani v United States, Iran-US. Cl. Trib. Rep. 954, (2003).

3. Stagl v. Delta Airlines, Inc., 52 F.3d 463, 469 (2d Cir. 1995).

4. Strong v Woolworths (2012) 246 CLR 182.

Statutes/Conventions

1. Arbitration Act B.E. 2545 (2002)

2. Thailand Civil and Commercial Code

3. Thailand Penal Code

4. International Chamber of Commerce, Commission on Commercial Law & Practice, Policy

Statement, Class Action Litigation, Doc. No 460/585, 1 (2005).

5. Civil Code (Germany)

Reports

1. Lovanovich I, ‘Personal Injury and Damages for Non-Pecuniary Loss in the Law of Torts

and the Product Liability Law’ (2011) (unpublished thesis for Master of Laws prograFaculty

of Law, Thammasat University), available online at:

http://digi.library.tu.ac.th/thesis/la/1816/title-biography.pdf.

2. Atcharawongchai, W. ‘The Non-Pecuniary Damages in Wrongful Acts Causing Bodily Harm

and Death: The Comparative Study on U.S. and Thailand Laws’ (2013) Volume 16(1).

3

Books

1. Kuck, LH and Litt GA, World Class Actions: A Practitioners Guide to Group and

Representative Actions Around the Globe (Oxford University Press, 2012)

2. Tetley, W. International Conflict of Laws: Common, Civil and Maritime (International

Shipping Publications, 1994)

3. Bar, Christian von, Non-Contractual Liability Arising out of Damage Caused to Another

(Berlin, Boston, Sellier de Gruyter, 2009) 747.

4. Moser, M. and Choong, J. Asia Arbitration Handbook (Oxford University Press, 2011)

5. Ferrari, F and Kroll, S. International Arbitration (Sellier, 2011)

6. Born, GB. International Commercial Arbitration (Kluwer Law International, 2nd ed, 2014)

Symeonides, SC. Codifiying Choice of Law Around the World: an International Comparative

Analysis (Oxford University Press, 2014)

Articles

4

STATEMENT ON JURISDICTION

The International Collective in Support of Textile Workers (“Claimant”) and Spear Shirts

Incorporated (“Respondent”) jointly submit the present dispute to the Thai Arbitration Institute

for Arbitration according to the Kuala Lumpur Regional Centre for Arbitration Rules (“KLRCA

Rules”).

The dispute includes issues on the Tribunal’s jurisdiction. Pursuant to Article 6 of the

KLRCA Rules, the Tribunal may elect to rule on its jurisdiction as a preliminary question or

in an award on its merits.

Both parties shall accept the judgment of the Tribunal as final and binding and execute it in

good faith in its entirety.

5

QUESTIONS TO BE PRESENTED

1. Which State’s law should apply to the substance of the dispute?

2. Can the Claimant bring a representative proceeding against the Respondent?

3. Is the Respondent liable for the Claimant’s harm?

a. whether the Respondent is liable in negligence under the Thailand Civil and

Commercial Code

b. whether the Respondent can be characterised as a joint actor

c. whether the Respondent can be held liable under the law of California

4. What remedies are available to the Claimant?

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STATEMENT OF FACTS

1. The Respondent is a wholesaler with it its principal place of business in Los Angeles,

California. The Respondent sells its clothing throughout the United States as well as

internationally. The Respondent has insurance which covers the injuries or deaths of its

employees, but this insurance does not extend to employees of its suppliers.

2. The Claimant is an NGO based in India who is bringing the action against the

Respondent on behalf of the victims and families of factory workers who suffered loss

from the Mae Sot factory fire. The Claimant investigates and reports on working

conditions in factories throughout Asia.

3. Mae Sot Clothing Ltd. (“Mae Sot”) is the largest of more than 100 clothing factories

located in or near the town of Mae Sot, Thailand. Mae Sot produces clothing for some of

the worlds most famous brands, including the Respondent’s brand, Spear Shirts TM.

Collectively, Mae Sot employs almost 38,000 Thai workers and more than 60,000

workers from Myanmar.

4. Early in 2013, Theodore Snowden (“Snowden”) assistant to the Vice President in charge

of purchasing at the Respondent company, Joe Baydon (“Baydon”), went on vacation to

the famous Aquamarine Resort in Phuket, Thailand. While on vacation, Snowden met up

with the General Manager of Mae Sot, Paul Castro (“Castro”).

5. Snowden sent a text message to Baydon which expressed how he was having a really

enjoyable time on vacation, admiring the beauty of Thai women and soaking up the sun.

Snowden casually mentioned that he met up with Castro who showed him around the

company and took him to lunch. Snowden reiterated the value of the shirts that Mae Sot

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was able to produce for the Respondent company and that just like back in the office, he

was constantly tripping over something.

6. Snowden told his boss that Castro had assured him that all the factory workers were

above the legal age while looking younger than they are. Snowden concluded the

message with his plan to go back to the beach for the day.

7. On 15 October, 2013 a fire erupted at Mae Sot factory (“factory”) which led to the total

destruction of the uninsured building. The fire started from an overheated textile machine

and quickly spread through the factory as a result of the negligent, or possibly grossly

negligent manner, that Mae Sot had been operating the factory in, such as non-

functioning fire extinguishers and blocked stair ways.

8. Fifty female employees lost their lives in the fire and more than 100 more were seriously

injured. The victims were all from Myanmar and many of them were under the age of 15.

9. The Claimant has accepted a report from an independent auditor that Mae Sot has no

assets and that it would be futile to pursue a legal action against it. The Claimant is

seeking compensation from the Respondent alleging that the Respondent company is

responsible in whole or in part for the injuries and fatalities which resulted from the fire.

10. In attempt to avoid the delay and costs associated with formal litigation, the Claimant and

the Respondent (together “the Parties”) have agreed to submit the dispute to binding

arbitration in Bangkok in accordance with the KLRCA Rules.

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SUMMARY OF PLEADINGS

1. The Law of Thailand applies to the substance of the dispute. Thailand is the most closely

connected State to the dispute. Therefore its laws are most appropriate under the

procedural rules agreed on by the Claimant and Respondent.

2. The Claimant is not entitled to bring a class proceeding against the Respondent because

the Respondent did not enter into any agreement for such an arbitration to occur. The

Claimant has an insufficient interest in the dispute. The agreed procedural rules of this

dispute are inadequate to govern a representative proceeding. In any case, in the event of

a representative proceeding, the represented class comprises the 13 members who signed

the agreement with ICSTW.

3. The Respondents are not liable to compensate for the Claimant’s loss because the

Claimant has not established any of the following causes of action:

a. The Respondent did not negligently cause the Claimant’s loss because the

Respondent owed no duty of care to the Claimant, nor was the Respondent’s

conduct the cause of the Claimant’s loss.

b. The Respondent is not a joint actor because it did not instigate or assist any

negligent actions by Mae Sot.

c. Nor would the Respondent be liable under the law of California, if it were to

apply instead of the law of Thailand, because the Respondent owes no duty of

care to the Claimant. Additionally and in the alternative, the Respondent’s actions

did not cause the Claimant’s harm.

4. If the Tribunal finds against for the Claimant, the Respondent should only be held liable

to pay compensatory damages to reflect its proportionate liability.

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RESPONDENT’S PLEADINGS

I The Law of Thailand should apply to the substance of the dispute

1. The parties have agreed, and it remains their common intention, for the present

proceedings to be governed by the KLRCA rules.1 The parties have agreed that Thailand

shall be the seat of the present arbitration.2

2. The law of the seat (lex arbitri), as contained in the Arbitration Act B.E. 2545 (2002)

shall apply. As the Act gives primacy to the parties’ choices, the designation by the

parties for the KLRCA rules to govern the procedural aspect of the arbitration is

effective. The lex arbitri shall apply, in respect of its mandatory laws, and also in respect

of procedural matters on which the KLRCA rules are silent.3

3. The parties have not designated a law to govern the substance of the present dispute, nor

have they designated a conflict of laws system to determine which substantive law should

apply. In such circumstances, article 35(1) of the KLRCA rules enable the tribunal to

determine the appropriate law to govern the substance of the dispute. The tribunal has a

wide discretion to make a direct choice under article 35(1), and is not confined by the

application of conflict of law rules.4 However, conflict of law rules, and international

principles on resolving conflicts can provide useful guidance in determining the

appropriate law.5

1 Moot Problem 2014, p. 3. 2 Further Clarifications, C1. 3 Henderson, A. and Srangsomwong S. ‘Thailand’ in Michael Moser and John Choong Asia Arbitration Handbook (Oxford University Press, 2011) 581, 586. 4 Silberman L and Ferrari F, ‘Getting to the law applicable to the merits in international arbitration and the consequences of getting it wrong’ in Conflict of Laws in Franco Ferrari and Stefan Kroll (eds) International Arbitration (Sellier, 2011) 257, 294. 5 Ibid 299.

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4. One widely internationally accepted principle is to apply the substantive law of the

jurisdiction with the most significant relationship, or the one that is most closely

connected to the dispute.6 This is the appropriate test to apply in this case.

5. Thailand is the most closely connected jurisdiction to the dispute because it is 1) the

place of the Complainant’s employment;7 2) the place of the incident that gave rise to the

present dispute;8 3) the place where the Claimant suffered its loss and 4) the seat of the

arbitration. Therefore, the laws of Thailand should govern the substance of the dispute.

6. The law of Myanmar is not appropriate to govern the substance of this dispute. Although

the Claimant comprises members whose domicile is in Myanmar, all of the losses

claimed by the Claimant are the result of the incident which occurred in Thailand, whilst

in the course of their employment in Thailand, with their Thai employer - Mae Sot. The

Respondents concede that the rule of domicile is also a well accepted international

principle.9 However, the fact that Thailand is more closely connected to the present

dispute than Myanmar, should operate as an exception to the rule of domicile. Further,

the rule of domicile is inappropriate in this dispute given the parties are domiciled in

different States.

7. The law of India is not appropriate to govern the substance of this dispute. India’s

connection with this dispute is limited to the involvement of the ICSTW.

6 Born, GB, Chapter 19: Choice of Substantive Law in International Arbitration in Gary B. Born , International Commercial Arbitration (Kluwer Law International, 2nd ed, 2014) 2614, 2644; Tetley, W. ‘Chapter 1: Four Classic Approaches to Solving Conflict of Laws’ in International Conflict of Laws: Common, Civil and Maritime (International Shipping Publications, 1994) 3. 7 Moot problem, p 2. 8 Ibid. 9 Symeonides, SC ‘Chapter 2: Law Governing Tort Conflicts’ in Codifiying Choice of Law Around the World: an International Comparative Analysis (Oxford University Press, 2014) 40, 60.

11

8. The law of California is not appropriate to govern the substance of this dispute. It was at

all material times, and continues to be the intention of the Respondent that the law of

California govern all elements of the Respondent’s Purchase Order (‘Purchase Order’)

agreement with Mae Sot. However, the Respondent’s intention in respect of the Purchase

Order does not extend to this dispute for these reasons:

a. The Purchase Order was a valid and enforceable contract between the

Respondent and Mae Sot. The Claimant brings their representative action in their

capacity as natural persons who were injured in the course of their employment.

The Claimant’s action is not brought by, nor on behalf of, Mae Sot; and

b. in addition, and in the alternative, it was the intention of the parties to the

Purchase Order that disputes arising from that agreement be governed by the law

of California.10 It was not the parties’ intentions that all disputes be so governed.

The Purchase Order was an agreement for the sale of goods by Mae Sot to the

Respondent only. The present dispute concerns injuries to the Claimant’s arising

from their employment with Mae Sot. This dispute cannot be said to arise from,

nor is it sufficiently connected with, the substance of the Purchase Order.

Therefore, the Respondent did not intend for the present dispute to be governed by the

law of California. There being no manifest intention from neither the Respondent nor the

Claimant, the appropriate law is Siamese law for the reasons in paragraph 5 above.

9. In the alternative, if the Arbitration Act B.E. 2545 (2002) were to apply, section 34 of

that Act provides that, where there is a conflict of laws, the tribunal is to apply conflict of

law rules to determine the appropriate law that is to govern the substance of the dispute.11

10 Clarifications to Moot Problem, attachment 1. 11 Arbitration Act B.E. 2545 (2002), s 34.

12

10. The jurisdictions with most contact to this dispute are Thailand and California. Thailand

is the place of the tort, and of the Claimant’s alleged loss. California is the place where

the goods manufactured by Mae Sot are delivered, and it is also the domicile of the

Respondent. The law of Thailand, which is a civil law system, is significantly different to

the Law of California, which is a quasi-common law system. Therefore there is a conflict

of laws in this dispute.

11. The conflict of law rules of Thailand are applicable, given the absence of a designation

by either party. Section 15 of Act on Conflict of Laws B.E. 2481 (1938) provides that the

law of the place where the tort occurred is to apply to the substance of the dispute.

Therefore, the law of Thailand would govern this dispute even if the lex arbitri was to

apply instead of the KLRCA rules.

12. In the alternative, if the Tribunal finds, contrary to paragraph 11, that the conflict of law

rules of the United States are applicable, the result is the same. The current prevailing

approach in the United States is to select the jurisdiction that has the most significant

relationship with the dispute.12 This is in line with the international principle discussed in

paragraph 4 above. As stated in paragraph 5 above, Thailand has the most significant

relationship with this dispute.

II The Claimant is not entitled to bring a class proceeding against the Respondent

13. The nature of class arbitration is different to that of a bilateral arbitration.13 Therefore, the

tribunal must not infer the Respondent’s agreement to arbitrate, as an agreement to

submit to class arbitration.14 A class arbitration can only be permitted in the present

12 Tetley, W. ‘Chapter 13: Torts & Delicts in General’ in International Conflict of Laws: Common, Civil and Maritime (International Shipping Publications, 1994) 427, 442. 13 Stolt-Nielsen S.A. v Animal Feeds International Corp, 130 S. Ct. 1758 (2010). 14 Ibid.

13

dispute if there is an intention to do so from both the Claimant and the Respondent. The

Respondent has not expressed such an intention. By putting the question into issue before

the tribunal reflects the Respondent’s very intention against a class arbitration.

14. The Claimant has no personal claim in this dispute. While representative class

arbitrations have occurred, the representative party in those cases have been an affected

party themselves. Public interest class actions have been brought before Courts in many

jurisdictions. However, litigation is different to arbitration. Confidentiality is a

cornerstone of arbitration,15 introducing public interest organisations such as the

Claimant as parties to arbitrations in which they have no personal claim jeopardises the

confidentiality of the proceedings and the resulting award. Such arbitrations have been

refuted.16

15. A representative action in this dispute jeopardises the finality of the award. A select

committee comprising 15 affected individuals are representing all the affected individuals

in their dealings with the Claimant.17 Of those, only 13 signed the agreement with the

Claimant.18 The risk that an award made by the tribunal will be subjected to sequential

and ongoing challenges by members of the group is high.

16. Both the Arbitration Act and the KLRCA rules are silent on procedural aspects of a

representative proceedings, nor have the parties agreed on an appropriate certification

procedure. In light of the foregoing, the class arbitration requested by the Claimant

should be denied, as it was not the intention of the Respondent, in agreeing to arbitrate

15 Born, GB, Chapter 1: Overview of International Commercial Arbitration in Gary B. Born , International Commercial Arbitration (Kluwer Law International, 2nd ed, 2014) 6, 88. 16 Sheibani v United States, Iran-US. Cl. Trib. Rep. 954, (2003). 17 Further Clarifications, D1(A). 18 Ibid.

14

under the KLRCA rules, that the tribunal invent rules on aspects that are not

contemplated by the governing procedural rules.

17. Each affected individual has a right to put forward their claims fully. Class arbitrations

erode this principle.19 To ensure this principle of arbitration is maintained, it is more

appropriate for the tribunal to join all consenting affected parties separately, and exclude

the Claimant - who has no personal claim - as a party.

18. In the alternative, if the Tribunal finds that, contrary to the submissions made in

paragraphs 13 to 16 above, a class arbitration is appropriate and permissible in the

circumstances, the Claimant has adopted an opt-out model in selecting participants to its

representative proceeding. This is an inappropriate model for arbitration, which gives

primacy to the intentions of each party.20 Under the Claimant’s present model, a member

of the class is automatically involved in the proceedings. Each individual should consent

to participating before being added to the proceeding, therefore an opt-in model for

selecting participants is more appropriate. Assuming an opt-in model. The Claimant is

representing the 13 affected individuals who signed the agreement giving the Claimant

full authority.

19. If a class proceeding is held, contrary to the Respondent’s submissions, then the

following is the relevant class:

a. members who were employees of Mae Sot, that were injured in the incident

(‘injured members’); or

19 International Chamber of Commerce, Commission on Commercial Law & Practice, Policy Statement, Class Action Litigation, Doc. No 460/585, 1 (2005). 20 Kuck, LH and Litt GA, Chapter 30: International Class Arbitration in World Class Actions: A Practitioners Guide to Group and Representative Actions Around the Globe (Oxford University Press, 2012) 700, 730. 20

15

b. familial members of those who died (‘inheritors’); and

c. signed the agreement conferring full authority to the ICSTW.

III The Respondents are not liable to compensate for the Claimant’s loss

A. The Respondent did not negligently cause the Claimant’s loss

20. The Respondents cannot be held liable under section 420 of the Thailand Code as they

did not ‘negligently, unlawfully [injure] the life, body, health...of another person’. As the

Thailand Code does not discern the particular constituent elements that are required to

establish negligence, the interpretation of the term under section 59 of the Thailand Penal

Code should be considered persuasive in determining the standard of negligence which is

required. Pursuant to section 59 of the Thailand Penal Code, the commission of ‘an act by

negligence’ denotes the commission of an offence that while unintentional, was ‘without

exercising such care as might be expected from a person under such condition and

circumstances’ and while the perpetrator was able to exercise such care, failed to do so

sufficiently. In the present case, a ‘person under such condition and circumstances’ as the

Respondent, being a global retailer with no ownership or control over the unrelated

supplier company, would not be expected to exercise care over the factory workers of

Mae Sot. The Respondent owed no legal duty to the employees of Mae Sot and was not

in a position to exercise care over the employees, as the company is headquartered in Los

Angeles, California and had no direct control over the operational aspects of its supplier.

21. The Respondent’s negligence cannot appropriately be characterised as an omission as

they did not create a situation of danger and were not responsible for ensuring that Mae

Sot complies with the law.

16

22. Even if the Respondents was held to have conducted themselves ‘negligently’, in order

for tortious liability to arise under section 420 of the Thailand Code, a causal link must be

established between the tortfeasor’s conduct and the resulting loss. Although not explicit

in the statute, causation is a requirement which underpins the attribution of liability in all

European tort systems as well as the common law system.21 The onus is on the Claimant

to prove that the Respondents caused the fire and subsequent loss suffered by the

victims.22

23. It is appropriate to consider the principles used to establish a causal link in the civil law

jurisdiction of Germany as:

a. the Thailand Code does not define the requisite elements of causation; and

b. Thailand law has its roots in German law and the equivalent provision under

section 823(1) of the Civil Code (Germany) is worded very similarly to the

relevant Thailand Code provision.

24. In order to establish that the damage can be imputed to the defendant under German tort

law, the conditio-sine-qua-non principle applies. This is similar in principle to the ‘but

for’ test adopted in common law jurisdictions.23 In the present case, there is no causal

link between the Respondent’s conduct and the resulting loss because if the Respondent’s

conduct in its dealings with Mae Sot through the Product Order were “assumed away”,

the damage would still have occurred. Furthermore, Snowden’s visit to the factory on a

vacation several months prior to the fire had no bearing on the fire as the Respondent’s

purchasing department had no operational control over the maintenance or running of the

21 Strong v Woolworths (2012) 246 CLR 182, 190 [18] 22 Bar, Christian von, Chapter 4: Causation in Non-Contractual Liability Arising out of Damage Caused to Another (Berlin, Boston, Sellier de Gruyter, 2009) 747, 755 23 Strong v Woolworths (2012) 246 CLR 182, 190 [18]

17

factory. Conversely, it is accepted that the fire started from an overhead textile machine

and that factors such as non-functioning fire extinguishers and blocked stair ways caused

the fire to spread so quickly.24

25. Moreover, the ‘adequacy theory’ operates to reduce the scope of liability in German tort

law and should be applied. The Respondent’s conduct is not an adequate cause of damage

under this approach as could only bring about the relevant damage under ‘particularly

unique, improbable circumstances’.25 The Respondent’s conduct in contracting with Mae

Sot for the manufacture of shirts using a Purchase Order is not an adequate cause of

damage as it is not suitable to cause the damage which arose.

26. Moreover, even if there was a causal link, the independent and voluntary actions of Mae

Sot in negligently operating the factory constituted an intervening act which broke the

causal link between the Respondent’s actions and the loss of the factory workers.

B. The Respondent is not a joint actor

27. Pursuant to section 432 of the Civil and Commercial Code, ‘[i]f several persons by a joint

wrongful act cause damage to another person, they are jointly bound to make

compensation for the damage...Persons who instigate or assist in a wrongful act are

deemed to be joint actors.’ The characterisation of ‘joint actor’ under German tort law

should be persuasively applied as the term is not defined in the Thailand Code.

28. Under section 830 of the Civil Code (Germany), joint enterprise connotes a deliberate and

willed collaboration of the participants to achieve a certain result.26 The Respondent is

not a joint actor of the negligence because there was no deliberate and willed

24 Moot Problem 2014, pp. 2 & 4 25 Bar, above n 21, 755. 26 Bar, above n 21, 778.

18

collaboration of the Respondents and Mae Sot in the present case other than for the

contractual supply and purchase of clothing.

29. The Respondents did not deliberately instigate or assist in the commission of a negligent

act by Mae Sot. The Respondents did not have any role in the maintenance or condition

of the factory.

C. The Respondent is not liable under the law of California

30. Even if the Tribunal were to apply the law of California, the Respondent owed no duty of

care to the Claimant.27 The Respondent cannot be held liable to the Claimants, those

injured and the representatives of those deceased in the factory fire, as their link is too

removed from each other. A duty of care would be found if the Claimant was a

reasonably foreseeable victim to the Respondent. Here, the Respondent is a mere

purchaser from Mae Sot, and it cannot be expected that the Respondents should have

further investigated into Mae Sot’s practices when they were not requested to and were

not in a place to. The ‘general rule’ of negligence is so well established that it is rarely

modified, to such extent that case law has articulated that modification ‘is reserved for

very limited situations’.28 The fact that the assistant to the Vice President, Snowden took

a vacation in Thailand cannot form the basis for the imposition of a duty of care. There is

no suggestion that it was reasonably foreseeable to the Respondent that the Claimant

would suffer loss as a result of their independent retail business.

31. If, contrary to the submissions made at paragraph 29, the Tribunal was to find that The

Respondents owed the employees of Mae Sot a duty of care and this was breached, the

27 Rodriguez v Bethlehem Steel Corp., 525 P.2d 669, 680 (Cal. 1974). 27 28 Stagl v. Delta Airlines, Inc., 52 F.3d 463, 469 (2d Cir. 1995).

19

Respondent did not directly cause the damage. The appropriate interpretation is that the

fire in the factory was a direct cause of Mae Sot’s negligence in failing to maintain the

factory, and operating the factory in substandard conditions with ‘blocked and/or

cluttered aisles and stairways’.29

IV Limited damages for the Claimant if action is successful

32. If contrary to the submissions made at paragraph 19 to 30 above, the Tribunal finds that

the Respondent is liable for the Claimant’s loss, then it is conceded that the Respondent

must compensate for the loss it caused. However, the Respondent cannot be held to be

solely nor completely liable for the full scale of the Claimant’s loss.

33. Mae Sot ran the factory in a negligent manner and is liable to compensate the victims of

loss. Although Mae Sot does not have any assets, it would be inappropriate for the

Tribunal to extend sole liability to the Respondent when they had no direct control over

the operation of the factory and were an unrelated company.

34. Additionally and in the alternative, the Respondent is not the only customer of Mae Sot.

The factory involved in the incident was manufacturing goods for at least five other

companies. The Respondent can be liable, at most, for one sixth of the Complainant’s

loss.

35. It is conceded that under section 432 of the Thailand Code, all persons responsible for the

Claimant’s loss are jointly bound to make compensation, unless otherwise decided by the

tribunal. Under the circumstances, contrary to these submissions the Respondent is found

liable, a reasonable effort to ascertain the other wrongful parties should be undertaken

before a strict exercise of section 432 of the Thailand Code.

29 Moot Problem, p. 4.

20

36. As submitted in paragraph 5 above, the law of Thailand is the appropriate law to govern

the substance of the dispute. An award of damages for the Claimant must therefore be

decided according to Book 2, Title V, Chapter II of the Thailand Code.

37. The Claimant is representing a class of persons comprising two sub-classes of members.

a. Members who were employees of Mae Sot, that were injured in the incident

(‘injured members’), a reference to ‘injured members’ is a reference to the class

and not to individuals of that class;

b. and familial members of those who died (‘inheritors’), a reference to ‘inheritors’

is a reference to the class and not to individuals of that class.

38. The inheritors are not entitled to claim compensatory damages for non-pecuniary

damages under section 446 of the Thailand Code.

39. The inheritors are not entitled to claim compensatory damages for loss of company or

bereavement. Section 445 of the Thailand Code only permits the inheritors to claim

compensatory damages where the deceased owed a legally enforceable duty of service to

the inheritor.30

40. The injured members are not entitled to claim compensatory damages for each of the

different types of non-pecuniary loss as separate and additional claims. The injured

members are limited, in respect of non-pecuniary loss, to a single claim for compensatory

relief.31

30 Lovanovich I, ‘Personal Injury and Damages for Non-Pecuniary Loss in the Law of Torts and the Product Liability Law’ (2011) (unpublished thesis for Master of Laws prograFaculty of Law, Thammasat University), available online at: http://digi.library.tu.ac.th/thesis/la/1816/title-biography.pdf. 30 Ibid. 31 Atcharawongchai, W. ‘The Non-Pecuniary Damages in Wrongful Acts Causing Bodily Harm and Death: The Comparative Study on U.S. and Thailand Laws’ (2013) Volume 16(1). 31 Ibid.

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CONCLUSION AND PRAYER FOR RELIEF

Based on the submissions above, the Respondent respectfully requests that the tribunal declares

the following:

1. That the law of Thailand apply to the substance of the present dispute.

2. That under both the law of Thailand and the law of California:

a. the Claimant is entitled to bring a representative proceeding against the

Respondent.

b. the Respondent is not liable, in negligence, for the loss suffered by the Claimant

by any means, including, but not limited to:

i. Direct liability;

ii. Vicarious liability; and

iii. Joint employer liability

c. the Respondent is not liable to compensate the Claimant for any aspect of its loss

including, but not limited to:

i. pecuniary loss; and

ii. non-pecuniary loss

d. the Respondent is not liable to pay punitive and/or exemplary damages.

e. if the Respondent is found to be liable, contrary to these submissions, it is only

liable for a one sixth proportion of the Claimant’s loss.

22