LORD BINGHAM OF CORNHILL
My Lords,
1. I have had the advantage of reading in draft the opinion of my noble
and learned friend Lord Brown of Eaton-under-Heywood. I am in full
agreement with it and would, for the reasons which he gives, allow the
appeal and make the order which he proposes.
LORD RODGER OF EARLSFERRY
My Lords,
2. I have the advantage of considering the speech of my noble and
learned friend, Lord Brown of Eaton-under-Heywood, in draft. I agree with
it and, for the reasons he gives, I too would allow the appeal and make
the order which he proposes.
BARONESS HALE OF RICHMOND
My Lords,
3. I agree that this appeal should be allowed, for the reasons given by my
noble and learned friend, Lord Brown of Eaton-under-Heywood. It is not
strictly necessary, therefore, to express a view on the issues discussed
by my noble and learned friend, Lord Mance, in paragraphs 42 to 53 of
his opinion. But they were fully canvassed in argument before us. I feel
it only fair, therefore, to confess that I share Lord Mance's views upon
those issues. In my view the English court is seised of proceedings for the
purpose of the Lugano Convention when the claim form is issued or when
the court first makes an order against the defendant in connection with
them, whichever is the earlier.
4. The particular facts of this case happen to provide a good illustration
of the artificiality of a different solution. These proceedings were a by-
product of the estate's proceedings against Mr Symes, in which Mrs
Nussberger had already been involved as a witness. They were effectively
begun by a worldwide freezing order against her of which she rapidly
became aware. In the county courts, the general rule has always been
that the court itself effects service of the claim form, a rule which now
applies throughout the civil justice system. In this particular case, the
court itself accepted the documents for service outside the jurisdiction in
accordance with the Hague Convention. It is unsatisfactory if a claimant
who has in fact begun his proceedings first in a court of competent
jurisdiction can be excluded from that jurisdiction as a result of the
vagaries of a service procedure over which he has no control. There is
no compelling reason for English law to adopt a service rule, given the
lack of a concept of lis pendens. All of this adds up to a powerful case for
holding that the English court was seised of these proceedings long before
19 January 2005. But, for the reasons Lord Brown has explained, it was
certainly seised of them no later than that.
LORD BROWN OF EATON-UNDER-HEYWOOD
My Lords,
5. The appellants are the administrators of the estate of Christo
Michailidis who before his death was in partnership with Robin James
Symes (now bankrupt) dealing in antiquities. Following Mr Michailidis'
death the appellants took proceedings against Mr Symes and various
court orders were made. On 14 February 2003, in breach of those orders,
Mr Symes sold a rare statue (an inlaid alabaster statue of the Egyptian
Pharaoh, Akhenaten) to the second respondent for US$3m, no part
of which has been paid. The second respondent is a Swiss company,
Galerie Nefer AG ("Nefer") whose sole proprietor and sole officer is
the first respondent, Frieda Nussberger ("Mrs Nussberger"), herself of
Swiss nationality. Nefer seeks to justify the non-payment of the statue's
purchase price by reference to various claims exceeding US$3m which Mrs
Nussberger asserts against the appellants and seeks to set off.
6. By the present proceedings, begun by claim form issued out of
the High Court on 16 December 2004 (the English proceedings), the
appellants claim US$3m against the respondents and in the alternative
certain lesser sums or damages against four further defendants, including
Mr Symes and his joint trustees in bankruptcy, whom I shall call simply
"the English defendants."
7. Subsequently, on 3 February 2005, in circumstances which I
must shortly recount in some detail, the respondents themselves
issued proceedings against the appellants in Switzerland (the Swiss
proceedings), claiming negative declaratory relief in respect of exactly the
same facts as those the subject of the English proceedings.
8. The question for the House is whether, in the light of the Swiss
proceedings, the English court must itself now decline jurisdiction over the
English proceedings and impose a stay. This in turn depends upon which
court was first seised of proceedings within the meaning of article 21 of
the Lugano Convention on Jurisdiction and the Enforcement of Judgments
in Civil and Commercial Matters 1988 ("the Lugano Convention")
scheduled to the Civil Jurisdiction and Judgments Act 1982 ("the 1982
Act"). Article 21 provides:
"Where proceedings involving the same cause of action and between the
same parties are brought in the courts of different contracting states,
any court other than the court first seised shall of its own motion stay its
proceedings until such time as the jurisdiction of the court first seised is
established. Where the jurisdiction of the court first seised is established,
any court other than the court first seised shall decline jurisdiction in
favour of that court."
9. It is common ground that the English proceedings (at any rate as
between the appellants and the respondents) and the Swiss proceedings
(at least in so far as they seek declarations relating to the Akhenaten
statue and the sale and proceeds of sale thereof) involve "the same cause
of action" and are "between the same parties."
10. The European Court of Justice held in Zelger v Salinitri [1984] ECR
2397 that a court's obligation under article 21 to decline jurisdiction in
favour of another court only arises if it is established that the parallel
proceedings have been "definitively brought before a court in another
state" (para 14 of the Court's judgment) and that it is for each state to
determine when this is:
"...the Court ‘first seised' is the one before which the requirements
for proceedings to become definitively pending are first fulfilled, such
requirements to be determined in accordance with the national law of
each of the courts concerned." (para 16 of the Court's judgment)
11. English law has hitherto determined that proceedings become
"definitively pending" only when they are served on the defendant-
see particularly Dresser UK Ltd v Falcongate Freight Management Ltd
[1992] QB 502 (the Court of Appeal decision which first so decided) and
Neste Chemicals SA v DK Line SA (The Sargasso) [1994] 3 AER 180
(a subsequent Court of Appeal decision holding that there could be no
exceptions to the rule). Under Swiss law, however, proceedings are held
to be "definitively pending" as soon as they are issued.
12. In this case, therefore, the Swiss court became seised of the Swiss
proceedings on 3 February 2005 when the respondents' claim was issued.
Had there already by then been service of the English proceedings upon
the respondents such as to make the High Court "the court first seised"?
That logically is the first question for your Lordships' determination.
13. The detailed circumstances of the case as to service are as follows. On
15 December 2004, the day before the English claim form was issued, the
appellants sought and obtained from Peter Smith J a worldwide freezing
order against the respondents, restraining them from disposing of their
assets up to a value of US$3m. The appellants undertook through counsel
to issue a claim form and serve it on the respondents together with
particulars of claim and various other documents underlying and including
the order itself.
14. On 16 December 2004, as already stated, the Court issued the
appellants' claim form against the respondents and the English
defendants. In issuing the form, the staff at the Court Registry of the High
Court erroneously stamped it "Not for service out of the jurisdiction". This
was a plain mistake because the claim form had expressly been rendered
eligible for service out of the jurisdiction by a statement upon it, verified
as true, stating that the High Court had power under the 1982 Act to hear
the claim and that no proceedings concerning it were pending in any other
relevant country.
15. Mrs Nussberger resides in the canton of Aargau in Switzerland,
Nefer's registered office being in Zurich. The proceedings, therefore,
had to be served on them in accordance with the provisions of the
Hague Convention on the Service Abroad of Judicial and Extrajudicial
Documents in Civil or Commercial Matters (1965) (Cmmd 3986) ("the
Hague Convention"). Articles 2 and 3 of the Hague Convention require
each contracting state to designate a "central authority" to effect service
of such documents as are forwarded to it with a request in the appropriate
form by the "authority or judicial officer competent under the law of the
state in which the documents originate." The competent judicial officer for
English proceedings is the senior master of the Queen's Bench Division,
and the relevant Swiss central authority is, in Mrs Nussberger's case, the
Obergericht of Aargau; in Nefer's case, the Obergericht of Zurich.
16. On 18 December the appellants filed requests for attachment (akin
to freezing orders in England) with the Zurzach Court in Aargau and
attachments were duly granted ex parte on 20 December.
17. On 21 December 2004 Mrs Nussberger was served by the authorities
in Zurich with the ex parte attachment orders together with Peter Smith
J's order of 15 December and (untranslated) particulars of claim in the
English proceedings dated 17 December (a fully detailed claim extending
to 22 pages).
18. All the documents required by the order of 15 December 2004 to be
served had first to be translated. On 31 December, when this had been
done, the appellants' solicitors presented these documents to the foreign
process section of the High Court for service on the respondents. Included
in these documents was the claim form, erroneously stamped "Not for
service out of the jurisdiction" (and the German translation of the form
including the stamp), an error noticed both by the appellants' solicitors
and by the official at the foreign process section who nonetheless
accepted the document for service. The senior master then arranged
for the documents to be forwarded to the relevant legal authorities in
Switzerland for service under the Hague Convention.
19. On 7 January 2005 the proceedings were served on the English
defendants.
20. On 19 January 2005, at the end of a hearing in the Zurzach court
held to review the Aargau attachment order made on 20 December, the
Zurzach judge (deputed by the Aargau Obergericht to effect service on
Mrs Nussberger under the Hague Convention) in the presence of the
appellants' solicitors handed her a package of documents for which she
signed a receipt. By then, however, unknown to anyone else, the judge or
his clerk had in fact inspected the documents, removed from the package
the English language claim form because of the words erroneously
stamped upon it, and resealed the package without it.
21. On 24 January 2005 Mrs Nussberger and her lawyers learned that the
claim form (although not the German translation of it) had been removed
from the package of documents served upon her and on 3 February 2005,
as already stated, she and Nefer issued their own proceedings against the
appellants in the Swiss court.
22. Only on receipt of a letter from the respondents' Swiss lawyers dated
9 February 2005 did the appellants become aware that the claim form
had been removed from the package of documents served upon Mrs
Nussberger and that the respondents had themselves now commenced
proceedings in Zurich.
23. In a Hague Convention certificate dated 11 March 2005 an official
of the Obergericht Aargau recorded that all the documents sent to the
Zurzach court had been served on Mrs Nussberger except only the claim
form, this document not being served because of the stamp it bore.
24. In March 2005 the appellants also learned that no documents had
been served on Nefer because of an error on the part of the Swiss Post
Office.
25. Having learned of the errors made in serving the respondents and
the subsequent issue of Swiss proceedings, the appellants sought orders
designed to ensure that the English proceedings had priority over the
Swiss proceedings under article 21 of the Lugano Convention. Following
a five-day hearing, Peter Smith J on 19 August 2005 gave judgment
([2005] EWHC 1880 (Ch)) allowing the appellants' application, dispensing
with service of the claim form upon the respondents pursuant to CPR r.6.9
and declaring that the High Court had become seised of the proceedings
as against the respondents on 19 January 2005. Consequential directions
were given and orders made to provide for further service of documents
including acknowledgment of service forms to enable the action to
proceed.
26. On 19 May 2006 the Court of Appeal (Pill, Neuberger and Wilson LJJ)
allowed the respondents' appeal, discharged the judge's order, set aside
the further service of documents effected pursuant to it, and stayed the
proceedings pursuant to article 21 ([2006] 1 WLR 2598). The principal
argument had centred upon CPR r.3.10 and CPR r.6.9 which provide as
follows:
3.10: "Where there has been an error of procedure such as a failure to
comply with a rule or practice direction-
(a) the error does not invalidate any step taken in the proceedings unless
the court so orders; and
(b) the court may make an order to remedy the error."
6.9: "(1) The court may dispense with service of a document."
27. Put shortly, the court held that it would be ineffective (or, if effective,
inappropriate) to invoke r.6.9 to enable the English proceedings to enjoy
article 21 priority: ineffective, because dispensing with the necessary
service of the claim form could not take effect earlier than when the
dispensing application was made (or perhaps, indeed, granted) and by
then the Swiss proceedings had already obtained article 21 priority;
inappropriate, because in any event it would be wrong to apply r.6.9
retrospectively specifically to disturb an already established order of
priority. (The court in addition rejected the appellants' contention,
pursuant to a respondent's notice, that the English court becomes seised
of proceedings under article 21 when the claim is filed at the High Court's
foreign process section rather than when thereafter it is actually served
upon the defendant abroad.)
28. Before your Lordships the appellants have advanced a series of
alternative arguments essentially as follows:
(i) Dresser was wrongly decided and English proceedings should be held
"definitively pending" as soon as they are issued;
(ii) The Sargasso was wrongly decided and the Dresser rule admits
of exceptions, one of which should be that English proceedings are
"definitively pending" once the court makes an interlocutory order against
the defendant (as here the freezing order against the respondents) on the
claimant's undertaking to serve the proceedings;
(iii) proceedings are "definitively pending" once the claimant delivers the
required documents to the foreign process section for service;
(iv) in a case involving multiple defendants, service on any of them (as
here service on the English defendants on 7 January 2005) is sufficient
for the English court to be seised of the proceedings against all the
defendants for the purposes of article 21;
(v) the court below should have found that the service effected upon the
respondents on 19 January 2005 was sufficient to satisfy the Dresser rule
so as to confer first seisin upon the English court.
As I have already suggested, it is logical to address that final issue first.
29. It is clear that the claim form should have been included amongst
the documents served upon the respondents on 19 January 2005. That
is provided for by CPR r.7.5 which dictates the period within which the
claim form "must be served on the defendant" (six months if it is to be
served out of the jurisdiction). It is no less clear, however, that (i) but
for the error made by the Swiss judge or his clerk in removing the claim
form from the package of documents sent to the Swiss authorities under
the Hague Convention specifically for service, it would have been served,
(ii) the documents in fact served included both the German translation
of the claim form and (served again in English and this time in German
translation too) the particulars of claim which set out in altogether greater
detail than the claim form itself the nature of the appellants' case, and
(iii) the respondents accordingly suffered no prejudice from the omission
of the English language claim form from the package of documents served
but rather used the omission as the opportunity to seek to achieve first
seisin in Switzerland.
30. In these circumstances essentially two questions fall for your
Lordships' consideration: first, is there power in the court by virtue of
CPR rr.3.10 and 6.9 to determine that the service of documents actually
effected on 19 January 2005 constituted sufficient service for the court
then to be seised of the proceedings as definitively pending before it
under the Dresser rule? Secondly, if so, ought the court in its discretion to
exercise that power?
31. I have already set out the relevant rules. It seems to me at least
arguable that even without resort to r.6.9 the court could simply order
under paragraph (b) of r.3.10 that the respondents are to be regarded
as properly served, certainly for the purposes of seisin. The "error of
procedure" here was, of course, the omission of the English language
claim form from the package of documents served: there was in this
regard "a failure to comply with the rule (r.7.5)." But that, says paragraph
(a) of r.3.10, "does not invalidate any step taken in the proceedings
unless the court so orders". The relevant "step" taken here was service of
the proceedings out of the jurisdiction.
32. It seems to me that this was essentially the view taken by the
majority of the Court of Appeal (McCowan LJ and Sir John Megaw, Lloyd
LJ dissenting) in Golden Ocean Assurance Ltd v Martin (The Goldean
Mariner) [1990] 2 Lloyd's Rep. 215. Several defendants were there
served out of the jurisdiction with copies of the writ, but in each case
the wrong copy, addressed not to him but to a different defendant.
Another defendant, by an oversight, was served with no writ at all, only
a form of acknowledgment of service. The court's procedure at that
time was governed by the RSC and the rule in point was O.2. r.1. For
present purposes I can see no material differences between that rule
and CPR r.3.10. All three members of the court accepted that O.2. r.1
was a most beneficial provision, to be given wide effect. The majority
held that service, the step in the proceedings which had plainly been
attempted, was to be regarded as valid in the case of all of the above
defendants. In the case of the defendants served with the wrong copy
writs, Lloyd LJ accepted that the court had a discretion: "The service
was grossly defective. But service, or purported service, it remained."
Unlike the majority, however, he would not have exercised that discretion
in the claimant's favour. As to the defendant served only with an
acknowledgment of service, Lloyd LJ thought it "an omission which is
so serious that...[i]t cannot be described as a failure to comply with the
requirements of the Rules by reason of something left undone....The
service of the form of acknowledgment cannot make up for the absence of
the writ." The majority thought otherwise. There was, be it noted, no rule
at that time akin to r.6.9. For my part I regard the errors and omissions
committed in the process of effecting service there as if anything more,
rather than less, serious than the error here (given the documents that
were served here).
33. The Court of Appeal thought The Goldean Mariner "simply not in
point" because "there was no question in that case of the retrospective
validation of an ineffective attempt to serve the writ operating to affect,
let alone to alter, the priority between English and foreign proceedings
under an international Convention". With respect, I cannot accept
this reasoning. The question in the The Goldean Mariner, just as the
question here, is whether the "attempt to serve the writ" was or was
not "ineffective". It was held there to have been, not ineffective, but
effective. That was not a "retrospective validation". Why should service
not similarly be declared to have been effective here? The question is
purely one for our domestic law, just as the question of when an English
court is seised of proceedings is purely one for domestic law (and, indeed,
the question of precisely what documents have to be served to achieve
effective service out of the jurisdiction under the Hague Convention is
purely one for domestic law).
34. As I have said, therefore, it may not be necessary to invoke r.6.9 at
all in order to declare the service of documents effected on 19 January
2005 to have been valid and effective. But assume, as both courts below
clearly thought, that it is necessary for the court actually to dispense with
service of the claim form under r.6.9 before the service in fact effected
can be declared valid. Is that within the court's power? The court below
concluded not, on the basis that an order under r.6.9 would by its very
nature involve the retrospective validation of what ex hypothesi would
otherwise fall to be regarded as ineffective service. And this essentially is
the argument by which the respondents now seek to uphold the Court of
Appeal's judgment.
35. There are, however, as it seems to me, two complete answers to this
argument. The first is this. In making the order pursuant to rule 6.9, Peter
Smith J was not thereby declaring valid and effective service which had
previously been ineffective; rather he was holding the previous service
to have been valid and declaring that it was unnecessary to have served
the English language claim form to make it so. It was in this sense that he
was dispensing with service. There was no more question here, therefore,
than in the The Goldean Mariner of "retrospective validation". The second
answer is that even if a dispensing order under r.6.9 was properly to be
regarded as retrospectively validating what would otherwise have been
ineffective service, in my judgment it would have been within the court's
power to make such an order. True, its effect would then be to alter the
jurisdictional precedence under an international Convention. But if, as
is uncontested, your Lordships could now overrule Dresser (just as the
Court of Appeal in Dresser itself departed from the ruling at first instance
that English courts are seised of proceedings at the date of issue), the
question of seisin being purely one for the national court, so too can an
English court, applying its own procedural rules to dispense with service
of a particular document, make an order which is effective retrospectively
to validate what would otherwise have been an invalid form of service. I
do not believe that this conclusion involves any exception to the Dresser
rule: the rule surely is that the English court is seised of proceedings
at the date of effective service, whatever that date may eventually be
declared to have been. If, however, it does constitute an exception, so be
it: to this limited extent I would if necessary qualify the decision in The
Sargasso.
36. So much for the court's power to dispense with service under r.6.9.
Should the court in its discretion exercise such power? That the court
would do so in a purely domestic context is surely clear beyond argument,
and this notwithstanding that the exercise of the power would operate to
defeat a prospective Limitation Act defence. Is it, however, appropriate to
make an order which has the effect of altering the priority of the seisin of
proceedings under an international Convention?
37. On any view the power is one to be exercised sparingly and only in
the most exceptional circumstances. It is difficult to suppose, for example,
that it could ever properly be exercised if there had been no process
of service whatever. Consider in this regard article 27(2) of the Lugano
Convention:
"A judgment shall not be recognised...(2) where it was given in default
of appearance, if the defendant was not duly served with the document
which instituted the proceedings or with an equivalent document in
sufficient time to enable him to arrange for his defence."
There can be no question here but that the respondents were served
with "an equivalent document": they had not only the German translation
of the omitted claim form but the detailed particulars of claim (in both
English and German) as well.
38. In my judgment the circumstances here were indeed exceptional,
the call on the exercise of the court's discretion compelling. As stated,
the respondents plainly suffered no prejudice whatever by the failure to
serve the original claim form but rather sought to exploit it, to steal a
march on the appellants. And the essential faults here were those of the
Swiss authorities: of the judge or his clerk at the Zurzach court (however
well-intentioned) in mistakenly removing the form from the package of
documents for service and the Swiss Post Office in failing to find Nefer's
post-box (in each case substantially delaying notification of the problem
to the appellants). If, moreover, the respondents are correct in their
arguments under articles 21 and 22 of the Lugano Convention that, if
the Swiss court here is properly to be regarded as first seised of the
proceedings as between the appellants and the respondents, then neither
the English court (in respect of the appellants' claim against the English
defendants) nor the Swiss court (in respect of the respondents' claim
against the appellants) has even a discretion to stay those respective
claims, that would provide yet a further compelling reason for declaring
the English court to be first seised of the whole action.
39. In short, the facts of this case could hardly be further from those
of Knauf UK GmbH v British Gypsum Ltd [2002] 1 WLR 907 which
involved a naked attempt to use CPR r.6.8 to subvert the Brussels
Convention. I for my part have no doubt that discretion under r.6.9
should (if necessary) be exercised here in the appellants' favour and that
the service effected on the respondents on 19 January 2005 should be
declared valid and effective. If your Lordships share my view, it follows
that none of the other issues needs to be considered. Given, moreover,
that a completely new regime has now been put in place both by the
EU (see the Jurisdiction and Judgment Regulation No. 44/2001 of 22
December 2000) and by the Lugano Convention states (see the new
Lugano Convention signed on 30 October 2007 and expected shortly to be
ratified)-whereby the time of seisin is defined autonomously instead of by
the member states themselves-it is surely inappropriate to review cases
like Dresser and The Sargasso which will imminently lose all relevance.
40. In the result I would allow this appeal, set aside the judgment of the
Court of Appeal, restore paragraphs 1 and 4 of the order of the judge
at first instance, and order that the questions of costs in this House be
adjourned for the parties to make written submissions within 14 days.
LORD MANCE
My Lords,
41. I have had the benefit of reading in draft the opinion of my noble
and learned friend, Lord Brown of Eaton-under-Heywood. For reasons
appearing in his opinion, I agree with him that, for the purposes of
both English law and the Lugano Convention, effective service of the
proceedings out of the jurisdiction was, and falls to be regarded as, made
on Mrs Nussberger on 19th January 2005 without any retrospective
validation. The English court was thus on any view definitively seised of
the proceedings as served on her on that date.
42. I would, for my part, also be prepared to go further and review
the decisions of the Court of Appeal in Dresser v. Falcongate Freight
Management Ltd. [1992] QB 502 and Neste Chemicals SA v. DK Line
SA (The Sargasso) [1994] 2 Ll. R. 6. I would conclude, having done so,
that the English court was definitively seised of the whole proceedings
from a still earlier date, being the date either of issue (16th December
2004) or of the freezing order (15th December 2004). In deciding
whether to review those previous Court of Appeal decisions, the imminent
replacement of the Lugano Convention would seem to me at best a
neutral factor, once permission was given, as it was, to appeal to this
House. I would not be deterred from such a review by the suggestion that
it might affect any other current cases where jurisdiction in one state or
another had been accepted on the basis of Dresser and The Sargasso.
If such cases exist, then, unless they are at a sufficiently early stage for
issues of jurisdiction to be raised and argued in the ordinary course, it
would probably be too late to raise them at all, but, even if not, it could
well be possible for any decision by the House on this appeal to be so
framed as to ensure that the settled course of such other cases was not
disturbed.
43. The Court of Appeal in Dresser was faced with a choice, which it
resolved in a different way to Hobhouse J at first instance who had taken
the issue of the writ as the moment of seisin. In my view, the choice
made by Hobhouse J is, and would have been, preferable on several
grounds.
44. First, the Court of Appeal's contrary solution in Dresser was influenced
by a view of the Advocate General's reasoning in Zelger v. Salinitri (Case
129/83) [1984] ECR 2397 and of the significance of the European Court's
use in its judgment in that case of the word "definitively", which were the
subject of a, to my mind convincing, critique in the judgment of my noble
and learned friend Lord Hoffmann in Canada Trust Co. v. Stolzenberg (No.
2) [2002] 1 AC 1, 18B-19F.
45. Second, the Court in Dresser never contemplated the rigid rule later
laid down by the Court in The Sargasso – indeed, one may even speculate
that, if it had, then the advantages in this respect of issue over service
might have prevailed. The important qualification which Bingham LJ
stressed in his leading judgment in Dresser in 1991 was that it would
be wrong, at so early a stage in the life of the Convention, "to attempt
to formulate any rule which will govern all problems which may arise in
the future", and in this regard Bingham LJ said at p.523F that "the most
obvious exception is where an actual exercise of jurisdiction (as by the
granting of a Mareva injunction or the making of an Anton Piller order
or the arrest of a vessel) precedes service: plainly the court is seised of
proceedings when it makes an interlocutory order of that kind". Yet in
The Sargasso in 1994 the Court of Appeal was prepared to re-examine
this qualification and to reject the existence of "any genuine exceptions
to the rule that the date of service marks the time when an English court
becomes definitively seised of proceedings" (per Steyn LJ at pp 11-12;
and see per Peter Gibson LJ and Sir Tasker Watkins at pp 12-13). It
adopted the argument (with which I would respectfully disagree) that
the power, under article 24 of the former Brussels and present Lugano
Convention, to give interim relief in aid of foreign proceedings militates
against Bingham LJ's view in Dresser that an English court giving such
relief in aid of its own substantive proceedings is definitively seised of
such proceedings.
46. Third, Bingham LJ in Dresser (at p.523A-C) indicated seven respects
in which service had possible significance in English procedural law. These
were that:
"(1) the court's involvement [in the issue of a writ is] confined to a
ministerial act by a relatively junior administrative officer; (2) the plaintiff
has an unfettered choice whether to pursue the action and serve the
proceedings or not, being in breach of no rule or obligation if he chooses
to let the writ expire unserved; (3) the plaintiff's claim may be framed
in terms of the utmost generality; (4) the defendant is usually unaware
of the issue of proceedings and, if unaware, is unable to call on the
plaintiff to serve or discontinue the action and unable to rely on the
commencement of the action as a lis alibi pendens if proceedings are
begun elsewhere; (5) the defendant is not obliged to respond to the
plaintiff's claim in any way, and not entitled to do so save by calling on
the plaintiff to serve or discontinue; (6) the court cannot exercise any
powers which, on appropriate facts, it could not have exercised before
issue; (7) the defendant has not become subject to the jurisdiction of the
court."
47. Even under English procedural rules as they stood in 1991, I cannot
share the Court of Appeal's view that these constitute clear pointers
towards service rather than issue as the appropriate moment for the
purposes of seisin under the then Brussels regime. Hobhouse J's choice
provided, as Steyn LJ said in The Sargasso, "a perfectly defensible
solution, which yielded a readily comprehensible point of time when the
Court becomes seised" (p.10). And, if the qualifications stressed by the
Court of Appeal in Dresser are rejected (as the Court in The Sargasso
considered that they should be), this alone affects several of the pointers.
48. The procedural significance attaching to issue and service in these
pointers is also no longer the same under the Civil Procedure Rules:
thus, as to the first respect, the court's involvement is often not confined
to issue, but extends to effecting service, unless the claimant opts to
undertake this (cf CPR 6.3); as to the second, fifth and seventh respects,
the procedure now generally applicable under CPR 7.4 and 7.5 provides
that a claim form must after issue be served on the defendant, and
under these rules and CPR 15.4 it is no longer service of the claim form,
but only the service of particulars of claim (which need not appear on
the claim form and are not required to be served until 14 days after its
service), that imposes on a defendant any obligation to defend; as to
the fourth respect, the defendant's potential lack of awareness of English
proceedings until service must be seen in the light of the reality that
defendants are very often aware of such proceedings and have often (as
in the present case) sought to use the inevitable delay in foreign service
to try to avoid them (see further the fourth ground below); and as to both
the sixth and seventh respects, the corollary of the Court of Appeal's view
in Dresser that issue gave rise to no new powers over a defendant was its
view (rejected in The Sargasso) that, where powers were exercised over
the defendant before issue, the court was then seised.
49. Fourth, the decisions in Dresser and The Sargasso have proved to
generate considerable scope for pre-emptive forum shopping, and were
also reached without consideration of the particular implications for multi-
defendant proceedings. These points are evidenced by a number of cases,
including Grupo Torras S.A. v. Al-Sabah [1995] 1 Ll.R. 374; [1996] 1 Ll.R.
7 (CA), Tavoulareas v. Tsavlaris [2004] 1 Ll.R. 455 (CA) and the present.
Pragmatic considerations of this nature were, in contrast, influential in
the House's decision in Canada Trust Co. v. Stolzenberg (No. 2) to take
the date of issue as the relevant date at which to ascertain whether
the defendant was domiciled in a contracting state for the purpose of
establishing jurisdiction under article 2 of the Brussels Convention: see
especially at pp. 9H and 12 B-E per Lord Steyn (with whose speech
Lord Cooke of Thorndon, Lord Hope of Craighead and Lord Hobhouse of
Woodborough all agreed) and pp.22F-23C per Lord Hoffmann.
50. Fifth, there is a natural conjunction between the moment of seisin and
the date relevant for the purpose of establishing domicile. Yet Dresser
and The Sargasso on the one hand and Canada Trust Co. v. Stolzenberg
(No. 2) on the other take different dates for these two purposes. Indeed,
to reconcile the result reached in Canada Trust Co. v. Stolzenberg (No.
2) with the decisions in Dresser and The Sargasso, article 52 (which, in
the case of a party not domiciled in the state "whose courts are seised of
the matter", requires such courts to apply the law of state B in order to
determine "whether the party is domiciled" in state B) had to be treated
as if the word "is" read "was" (cf pp.9H-10A per Lord Steyn). Otherwise,
as Lord Steyn said, the "absurd consequence" would follow that the date
relevant to domicile depended on various fortuitous consequences. But
such consequences are avoided, more convincingly and consistently with
the language, by judging both seisin and domicile as at the date of issue
of proceedings.
51. I would therefore, so far as it may be necessary in order to resolve
this appeal, adopt a general test of issue as the relevant date for seisin
under article 21 of the Lugano Convention. That moment has the
advantage, which the Court identified in The Sargasso, of offering a single
certain and easily ascertainable date. But, if that were not to be accepted,
then I would revert to the more nuanced test of seisin which the Court
adopted in Dresser itself, which in the present case would be satisfied by
virtue of the interim injunction granted against the respondents in aid of
the substantive English proceedings.
52. Had I accepted neither of those solutions, I would have been prepared
to look carefully once again at the principles which should under the
present Lugano regime cover a multi-defendant case such as the present
once one defendant has been effectively served. If it were possible to
treat a court at least as seised of the whole proceedings once one of
the parties to, or at least one of the parties common to, the two sets of
proceedings had been served, that would recognise that this event and
moment have real significance (cf my observations in Grupo Torras [1995]
1 Ll.R. 374, 419); it would assist to ensure the integrity of proceedings
and counter the possibility of procedural manoeuvring by co-defendants.
53. There can be little doubt, and Mr Martin QC for the respondents
accepted, that article 22 requires a single date of composite seisin, which
would on the basis of Dresser be ascertained by reference to the date
when the first party was served in either set of proceedings. For article
21 to apply there must be proceedings in different contracting states
between parties at least some of whom are identical on each side, and
article 21 then applies, and only applies, as between those who are
identical: The Tatry v. The Maciej Rataj (Case C-406/92) [1999] QB 515.
It does not necessarily follow that the court should then be regarded as
seised by considering, on an identical party to identical party basis, which
party was first served. The Tatry did not concern or consider any such
situation. But I need not go so far down a chain of hypotheticals as to
express any view on any aspect of the area of multi-party litigation, save
that it would have merited at least some further thought.