THE LAWASIA INTERNATIONAL MOOT IN THE KUALA LUMPUR REGIONAL CENTRE FOR ARBITRATION BANGKOK, THAILAND BETWEEN

Transcription

1 B1408-C THE LAWASIA INTERNATIONAL MOOT IN THE KUALA LUMPUR REGIONAL CENTRE FOR ARBITRATION BANGKOK, THAILAND 2014 BETWEEN THE INTERNATIONAL COLLECTIVE IN SUPPORT OF TEXTILE WORKERS (ICSTW) (CLAIMANT) AND SPEAR SHIRTS INC. (RESPONDENT) MEMORIAL FOR CLAIMANT

2 TABLE OF CONTENTS TABLE OF CONTENTS... ii STATEMENT OF JURISDICTION... v INDEX OF AUTHORITIES... vi QUESTIONS PRESENTED... viii STATEMENT OF FACTS... 1 SUMMARY OF PLEADINGS... 4 PLEADINGS... 6 I THE ARBITRAL TRIBUNAL HAS JURISDICTION OVER THE DISPUTE BETWEEN MAE SOT CLOTHING LTD. AND SPEAR SHIRTS INC..6 A Source of jurisdiction B Applicable law II THE ARBITRAL TRIBUNAL SHOULD ADMIT A LARGE NUMBER OF CLAIMANTS TO JOIN IN A SINGLE ARBITRATION.6 A The Thai draft law has Class action procedures The victims satisfy Class 7 B The arbitral tribunal should apply the United States Federal Rules of Civil Procedure..7 1 Rule 23 of the United States Federal Rules of Civil Procedure provides Class ii

3 action 8 2 The victims satisfy Rule 23 of the United States Federal Rules of Civil Procedure The victims of the fire meet the definition of class in the code The victims of the fire have questions of law or fact common to the class 9 III THE APPLICABLE LAW IS THAILAND LAW 9 IV THE RESPONDENT SHOULD BE HELD LIABLE FOR THE INJURIES AND DEATHS OF MAE SOT CLOTHING S EMPLOYEES 10 A The Respondent is the employer of the victims.10 B The Respondent was in charge of the labor environment in the burned factory...11 C The respondent avoided the obligation to improve the labor environment of the factory.11 V EVEN IF THE ARBITRAL TRIBUNAL DOES NOT ADMIT THAT THE RESPONDENT IS NOT THE EMPLOYER, THE RESPONDENT SHOULD BE HELD LIABILITY FPR THE VICTIMS 12 A Mae Sot is responsible for the victims 12 B The Respondent has liability for the victims jointly with Mae Sot.13 C The Respondent take the responsibility of its authorized representative s illegal act iii

4 because Baydon pretermitted the labor environment of the factory.13 1 Baydon is authorized representative person of Spear Shirts The victims were damaged because Baydon had ignored the terrible labor environment 13 CONCLUSION AND PRAYER OF RELIEF iv

5 STATEMENT OF JURISDICTION The International Collective in Support of Textile Workers (ICSTW) ( the Claimant ) and Spear Shirts Inc. ( the Respondent ) have agreed to submit this dispute to binding arbitration in Bangkok in accordance with the KLRCA Arbitration Rules. Both parties had no designation about applicable to the substance of dispute. Article 35 of KLRCA provides that failing such designation by the parties, the arbitral tribunal shall apply the law which it determines to be appropriate. Article 15 of Thailand Law Conflict Act provides that an obligation arising out of a wrongful act is governed by the law of the place where the facts constituting such wrongful act have taken place. v

6 INDEX AUTHORITIES Statutes and Treaties A PRIMER ON THE THAI DRAFT LAW ON CLASS ACTION 6,7,8 CHUKIERT RATANACHAICHAN* Permanent Law Councillor Member of the Civil Procedure Code Revision Committee Office of the Council of State FEDERAL RULES OF CIVIL PROCEDURE WITH FORMS 7,8,9 December 1, 2013 KLRCA Arbitration Rules (Revised in 2013) 9 Occupational Safety, Health and Environment Act B.E (2011) 10,11,12 Conflict of Laws Act, B.E (1938) 10 THAILAND Civil and Commercial Code 12,14 WORKMEN S COMPENSATION ACT B.E (1994) 12 Cases Western Canadian Shopping Centres Inc. v. Dutton 9 [2000] S.C.J. No SCC 46 File No.: Also reported at: [2001] 2 S.C.R. 534 Supreme Court of Canada Hearing and judgment: December 13, Reasons delivered: July 13, 2001 GLORIA M. LOPEZ and DON D. MOYA, II, on behalf of themselves and all others 9 similar situated, Plaintiffs, vs. CITY OF SANTA FE, Defendant. CIV No MV/DJS UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW MEXICO 206 F.R.D. 285; 2002 U.S. Dist. LEXIS 4769 March 13, 2002, Decided vi

7 PAUL CASALE and ANTHONY GARCIA, on Behalf of Themselves and Others 9 Similarly Situated, Plaintiffs, - against - RAYMOND W. KELLY, Commissioner of the New York City Police Department (NYPD); CITY OF NEW YORK; JOHN/JANE DOES 1-50 (NYPD Supervisory, Training and Policy Personnel); and JOHN/JANE DOES (NYPD police officers), Defendants. 08 Civ (SAS) UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK 257 F.R.D. 396; 2009 U.S. Dist. LEXIS June 1, 2009, Decided June 1, 2009, Filed 2005(Ne)3588, Osaka High Court, Judgment of November 17,2006, 11 Reference number: 2006WLJPCA Scholarly Work and Articles The Duty of Arbitrator to A;;ly the Law (1) Wang, Chinyen 7 Published Analysis on the Basic Requirements for Class Certification; 9 Numerosity and Common Questions specified in Federal Rules of Civil Procedure Rule23(a)(1)and (2) Hiroyuki YUZURIHA vii

8 QUESTIONS PRESENTED 1 May a large number of claimants (victims and their families) be joined in a single arbitration? 1.1 Should be applied the United States Federal Rules of Civil Procedure? 1.2 Should be applied Rule 23 of the United States Federal Rules of Civil Procedure? 1.3 Do the victims satisfy the requirements of Class action? 2 Is The Respondent treated as Employer of the victims? 3 If the Respondent is not Employer, is The Respondent obligated to pay compensation? 4 Does the Respondent take the responsibility of its authorized representative s illegal act? viii

9 STATEMENT OF FACT THE CLAIMANT The Claimant ICSTW is the NGO based in India which investigates and reports on working conditions in factories throughout Asia. It represents the victims and their families in the fire in Mae Sot Clothing Ltd. All the victims lost their lives or suffered burns. THE RESPONDENT The Respondent Spear Shirts Inc. is the company which sells clothing throughout the United States and much of the world and has its principle place of business in Los Angeles, California. The Respondent neither has a Company Code of Conduct, nor has made any announcements to commit to labor standards in their supply chain. Furthermore, the Respondent didn t belong to any international agreement that advocated for workers safety. MAE SOT CLOTHING LTD. Mae Sot Clothing Ltd is the largest of the more than 100 clothing factories located in or near Mae Sot. It produces clothing which carries some of the world s most famous brands, including Spear Shirts. It doesn t have any divisions or subsidiaries and has no assets and it would be futile to pursue a legal action against it. THE FIRE On October 15, 2013, a fire raced through the Mae Sot factory. The fire apparently started from an overheated textile machine and quickly spread through the factory. It is quite likely 1

10 that the machine which started the fire was being used at the time to shirts for the Respondent since the Respondent was Mae Sot s biggest customer. Fifty employees all women - lost their lives in the fire and more than 100 more were seriously injured. Mae Sot was making shirts for the Respondent when the fire occurred and many victims in the fire were assigned to the production of shirts for the Respondent. RELATIONSHIP BETWEEN SPEAR SHIRTS AND MAE SOT CLOTHING Mae Sot Clothing is its largest supplier of men s shirts for the Respondent and the Respondent is it largest customer for Mae Sot Clothing. The Respondent has been purchasing men s shirt from Mae Sot Clothing for about 10 years. Mae Sot Clothing begins producing most shirts for the Respondent only upon receiving the individual orders from the Respondent and the Respondent logo is attached on the products. There is no label or other indication on the shirts indicating they were manufactured by Mae Sot. Furthermore, there weren t any previous communications between Mae Sot and Spear Shirts in regards to the working conditions, working age, and matters consequential and incidental thereof, and neither the Respondent nor Mae Sot have modified any part of Spear Shirts Standard Purchase Order in writing and consistently use it. SAFTY CONCERNS IN MAE SOT FACTORY Four years ago, Thai government entity ever inspected the factory for safety concerns, but it 2

11 is likely that Mae Sot s management had been advised that an inspection would be made more than a week before it took place. Therefore, the report for the inspection lacks credibility. The Respondent didn t get the reports and the Respondent officers or employees didn t pay any other visits to Mae Sot Clothing, or make any attempt to determine the working conditions at the Mae Sot factory. Moreover, several months prior to the fire, while vacationing at the famous Aquamarine Resort in Phuket, Theodore Snowden, an assistant to Joe Baydon, Vice President in charge of purchasing at Spear Shirts, sent Mr. Baydon the text message which reported the condition in Mae Sort and Mr. Baydon forwarded it to the President of Spear Shirt Inc. The text message said that there was stuff rolls of fabric and carts filled with partly finished shirts all over the floor in the factory of Mae Sot. 3

12 SUMMARY OF PLEADINGS THE ARBITRAL TRIBUNAL HAS JURISDICTION OVER THE DISPUTE BETWEEN MAE SOT CLOTHING LTD. AND SPEAR SHIRTS INC. THE ARBITRAL TRIBUNAL SHOULD NOT ADMIT A LARGE NUMBER OF CLAIMANTS TO JOIN IN A SINGLE ARBITRATION. The Thai draft law has Class action procedures and the United States Federal Rules of Civil Procedure have Class action procedure. The victims satisfy the requirement of Class action. THE RESPONDENT TAKE THE RESPONSIBILITY TO VICTIMS AS AN EMPLOYER. The Respondent is treated as the employer of the victims. The Respondent was in charge of the labor environment in the burned factory. However, the Respondent avoided the obligation to improve the labor environment of the factory. Therefore, The Respondent take the liability for damage because it neglected the obligation of security. EVEN IF THE RESPONDENT IS NOT TREATED AS EMPLOYER, THE RESPONDENT HAS LIABILITY FOR THE VICTIMS. Mae Sot is responsible for the victims, but Mae Sot did not performance responsible for the victims. The Respondent is principal contractor of Mae Sot Clothing. Therefore, the Respondent is liable with Mae Sot Clothing. THE RESPONDENT TAKE THE RESPONSIBILITY OF ITS AUTHORIZED REPRESENTATIVE S ILLEGAL ACT. Joe Baydon, Vice President in charge of purchasing at Spear Shirts, is authorized representative person of Spear Shirts. The victims 4

13 were damaged because Baydon had ignored the terrible labor environment. His connivance constitutes tort. Therefore, the Respondent take the responsibility of its authorized representative s illegal act. 5

14 PLEADINGS I THE ARBITRAL TRIBUNAL HAS JURISDICTION OVER THE DISPUTE BETWEEN MAE SOT CLOTHING LTD. AND SPEAR SHIRTS INC. A Source of jurisdiction The Office of the Arbitration Tribunal attached to Thai Arbitration Institute (hereunder,"tai") has the jurisdiction over the dispute between Mae Sot Clothing Ltd. and Spear Shirts Inc. The Arbitral Tribunal has the authority to rule on its own jurisdiction. The decision is final and binding on the Parties. B Applicable law Since both the parties have expressly agreed to submit this dispute to binding arbitration in Bangkok, The Thai Civil Procedure Code shall be the applicable law to the disputes presented before the arbitral tribunal because Seat of Arbitration is Thai. II THE ARBITRAL TRIBUNAL SHOULD ADMIT A LARGE NUMBER OF CLAIMANTS TO JOIN IN A SINGLE ARBITRATION A The Thai draft law has Class action procedures In the present case, the arbitral tribunal has the authority to decide whether Class action is permitted or not under the Thai Civil Procedure Code but there are no specific provisions indicating how to conduct the taking of evidence in the Thai Civil Procedure Code. The Thai Civil Procedure Code is silent about whether Class action is permitted or not. However, the 6

15 arbitration does not need to necessarily depend on current law because arbitrator has big discretionary authority based on good and the fairness. 1 A Primer on the Thai Draft Law on Class action 2 shall be applied. The draft law is being waited for the introduction of the National Legislative Assembly as a Bill of Law and has already been completely considered by the Committee for Revision of the Civil Procedure Code. 1 The victims satisfy Class The victims of the fire meet the definition of class in the code. Class action procedures under the draft law are provided under Part 2 Chapter 2 Sub-chapter 4 of the Draft law. It provides that The draft law on Class action contains definitions of several key terms, Class means a group of persons having identical rights arising from common issues of facts and law as well as possessing identical characteristics that are specific to the class even if there are variations in the type of damages suffered by each person. From this definition, the elements of a class may be separately considered, as follows: - Common fact - Common law In the present case, the victims have identical rights arising from the fire despite variations in the specific damages suffered. B The arbitral tribunal should apply the United States Federal Rules of Civil 1 The Duty of Arbitrator to A;;ly the Law (1) Wang, Chinyen Published A Primer on the Thai Draft Law on Class Action CHUKIERT RATANACHAICHAN 7

16 Procedure The Claimant also submits that the United States Federal Rules of Civil Procedure 3 can be applied in this case because The United States Federal Rules of Civil Procedure was the basis of the draft law for class actions in the Thailand Civil Procedure Code. According to these Rules, Class action should be considered by the arbitral tribunal. 1 Rule 23 of the United States Federal Rules of Civil Procedure provides Class action Rule 23(a) of the United States Federal Rules of Civil Procedure provides that one or more members of a class may sue or be sued as representative parties on behalf of all members only if: (1) the class is so numerous that joinder of all members isimpracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class. Moreover, Rule 23(b)(3) of the United States Federal Rules of Civil Procedure also provides that the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy. 3 FEDERAL RULES OF CIVIL PROCEDURE WITH FORMS DECEMBER 1, 2013 UNUME PLURIBUS 8

17 2 The victims satisfy Rule 23 of the United States Federal Rules of Civil Procedure 2.1 The victims of the fire satisfy the requirement of class in the code The class is so numerous that joinder of all members is impracticable. According to cases tendency, it is impossible to sue individually the when numbers of claimants amount to When the numbers of claimants is over 40, arbitral tribunals and courts admit Class action with high probability 5. The numbers of the victims in the present case is over 150, so the victims satisfy the numerousness. 2.2 The victims of the fire have questions of law or fact common to the class In the present case, there are questions of law or fact common to the class. The victims have identical rights arising from the fire despite variations in the specific damages suffered. If there is one, the question of law or fact common to class is enough 6. All questions do not needed to be common. Ⅲ THE APPLICABLE LAW IS THAILAND LAW In the present case, both the parties agreed submit this dispute to arbitration in accordance with KLRCA Arbitration Rules 7. 4 GLORIA M. LOPEZ and DON D. MOYA, II, on behalf of themselves and all others similar situated, Plaintiffs, vs. CITY OF SANTA FE, Defendant. And PAUL CASALE and ANTHONY GARCIA, on Behalf of Themselves and Others 5 Analysis on the Basic Requirements for Class Certification;Numerosity and Common Questions specified in Federal Rules of Civil Procedure Rule23(a)(1)and (2) Hiroyuki YUZURIHA 6 Western Canadian Shopping Centres Inc. v. Dutton 7 Moot Problem, p3 9

18 The Arbitration Rule 8 article 35 provide that the applicable law is the arbitral tribunal apply the law which it determines to be appropriate if the parties have no designation of apply. In this case, the parties did not designated any law as applicable to the substance of the dispute. Therefore, the applicable law to this dispute is determined by the arbitral tribunal. Thailand s conflict of laws act 9 section 15 provides An obligation arising out of a wrongful act is governed by the law of the place where the facts constituting such wrongful act have taken place. The foregoing provision does not apply to facts which, having taken place in a foreign country, are not wrongful according to the Thai law. In this case, the fire; the facts constituting wrongful act was broken out in Thailand 10. Therefore, the applicable law to this dispute is Thailand law. Ⅳ SPEAR SHIRTS SHOULD BE HELD LIABLE FOR THE INJURIES AND DEATHS OF MAW SOT CLOTHING S EMPLOYEES A The Respondent is the employer of the victims Section 4 of Thailand Occupational Safety, Health and Environment Act 11 provides that in the act, Employer means an Employer under the labor protection law and also entrepreneur who allows any person to work for or to provide benefit for/or in an establishment, whether the working or providing some benefit in part or as a whole or a part of production process or 8 KLRCA Arbitration Rules (Revised in 2013) 9 Conflict of Laws Act, B.E (1938) 10 Moot Problem, p2 11 GENERAL REFERENCE LIST, Occupational Safety, Health and Environment Act 10

19 business under responsibility of the entrepreneur. In the present case, Spear Shirts allows the victims work for Mae Sot Clothing. Therefore, no matter whether the working or providing a part of production process or business under responsibility of the Spear Shirts, Spear Shirts is treated as Employer. B The Respondent was in charge of the labor environment in the burned factory Section 6 of Thailand Occupational Safety, Health and Environment Act provide that an Employer is obligated to provide and keep an Employee in safe and hygienic working conditions and environment including to support and promote an operation of the Employee preventing the Employee from any harm on life. In the present case, not only Mae Sot Clothing but also Spear Shirts is treated as Employer defined in Occupational Safety, Health and Environment Act. Therefore, Spear Shirts was obligated to provide and keep the victims, who worked for the Mae Sot Clothing in safe. 12 C The Respondent avoided the obligation to improve the labor environment of the factory The Respondent avoided the obligation to provide and keep the victims in safe though The Respondent was aware of the dangerous labor environment. Prior to the fire, Baydon, vice president in charge of purchasing at Spear Shirts became aware of the labor environment in the factory because Snowden who is an assistant to (Ne)3588, Osaka High Court, Judgment of November 17,2006, Reference number: 2006WLJPCA

20 Snowden reported the abuse of victims to Baydon in 13. However, in fact, The Respondent took no effort to provide or keep in safe the labors working at the factory. Considering the telling that the terrible labor environment enabled the Respondent to buy clothing in low price from Mae Sot Clothing 14, it is assumed that The Respondent turned a blind eye to Mae Sot Clothing in order to earn the benefit of supply of shirts in low price from Mae Sot Shirts. The Respondent avoid illegally avoid the obligation provided by Thailand Occupational Safety, Health and Environment Act. The Respondent take the liability for damage because it neglected the obligation of security. The avoidance of obligation provided by Thailand Occupational Safety, Health and Environment Act constitute a tort. The Respondent take liability for damage provided by Thailand Civil and Commercial Code 15 section 420. V EVEN IF THE ARBITRAL TRIBUNAL DOES NOT ADMIT THAT THE RESPONDENT IS NOT THE EMPLOYER, THE RESPONDENT SHOULD BE HELD LIABILITY FPR THE VICTIMS A Mae Sot is responsible for the victims Mae Sot Clothing was the Employer of the victims. Article 13, 15 and 16 of Thailand Workmen s Compensation Act 16 provide that Employer of damaged workmen had obligation 13 Moot Problem,p2 14 Moot Problem, p2 15 THAILAND Civil and Commercial Code 16 WORKMEN S COMPENSATION ACT B.E (1994) 12

21 to pay reparations. Therefore, in the present case, Mae Sot Clothing had obligation to pay necessary medical expense to injured victims as provided article 13 of Thailand Workmen s Compensation Act and rehabilitation expense to the victims who need to obtain industrial rehabilitation as provided article 15 of Thailand Workmen s Compensation Act. B The Respondent has liability for the victims jointly with Mae Sot Mae Sot Clothing has not implemented its obligation to pay reparations provided article 13, 15 and 16 of Thailand Workmen s Compensation Act. Article 10 of Thailand Workmen s Compensation Act provides that principal contractor is liable with the subcontractor if the employer, who is the subcontractor, does not pay the compensation. In this case, the subcontractor Mae Sot Clothing cannot pay compensation to victims. Therefore, The Respondent, the principal contractor of Mae Sot Clothing is liable with Mae Sot Shirts to pay compensation. As a result, Mae Sot Shirts is equally obligated to pay compensation for the victims provided by article 13, 15 and 16 of Thailand Workmen s Compensation Act. C The Respondent take the responsibility of its authorized representative s illegal act because Baydon pretermitted the labor environment of the factory. 1 Baydon is authorized representative person of Spear Shirts. Baydon was The Respondent vice president in charge of purchasing. He was authorized representative person of Spear Shirts at least in term of purchasing activity. 13

22 2 The victims were damaged because Baydon had ignored the terrible labor environment. Although Baydon was informed of the dangerous labor environment by the sent from Snowden, Baydon took no effort to keep the victims safe. Although Baydon was informed of the dangerous labor environment by the sent from Snowden, Baydon took no effort to keep the victims safe. When the fire broke out, Mae Sot factory was making products for the Respondent. Therefore, Baydon s connivance caused the fire and damage of the victims. His connivance constitutes a tort. Thailand Civil and Commercial Code article 76 provides that A juristic person A juristic person is bound to make compensation for any damage done to other persons by its representatives or the person empowered to act on behalf of the juristic person in the exercise of their functions any damage done to other persons by its representatives or the person empowered to act on behalf of the juristic person in the exercise of their functions. Therefore, in this dispute, The Respondent is bound to compensate for victims damage caused by Baydon s connivance. 14

23 CONCLUSION AND PRAYER OF RELIEF Based on the above submissions, Claimant respectfully requests this Tribunal to arbitrate and declare as follows on the Questions Presented: A Thai Arbitration Institute has jurisdiction under in accordance with the KLRCA Arbitration Rules. The Thai Civil Procedure Code and Thai civil Code shall be applied as the applicable law. B That under the Thai Code, 1 The draft law or the Federal Rules of Civil Procedure shall be applied 2 Class action should be admit 3 The Claimant satisfy the requirement of Class action 4 The Respondent should be held liable for the injuries and deaths of Mae Sot Clothing s employees. 5 Even if the arbitral tribunal does not admit the Respondent is an employee of Mae Sot, the Respondent should have responsibility to the victims 15