This is an appeal by the defendants in the action against an order of
Hoffmann J. made on 22 March 1991. By that order the judge directed
that the plaintiffs have leave to amend the writ to join P.& G. G.m.b.H.
("G.m.b.H.") as third defendant in the action and to make consequential
re-amendments of the statement of claim.
The action is a patent action for infringement of a United Kingdom patent
relating to disposable nappies. The first plaintiff, a Swedish company, is
the registered proprietor of the patent. The second plaintiff, an English
company, is the exclusive licensee under the patent. The first and second
defendants and G.m.b.H. are companies in a well known multinational
group. The first defendant, P. & G. Ltd., is the English company which
is a member of the group. The second defendant, The P. & G. Co., is
the American parent company of the group. G.m.b.H. is the German
company in the group. The infringement relied on in the statement of
claim is the marketing in the United Kingdom by the first defendant of
nappies manufactured by G.m.b.H. in Germany; they were sold under
the name "Pampers." The first and second defendants and G.m.b.H. were
at all material times well aware of the patent. Their position is that their
products do not infringe the patent.
The judge, in allowing the joinder of G.m.b.H., applied the test for striking
out under R.S.C., Ord. 18, r. 19. He said:
"So it seems to me that in this case I must also look at the matter as
if the plaintiffs were intending to pursue a substantive remedy against
[G.m.b.H.]. It follows that as no leave is required for service, the
plaintiffs are entitled as of right to implead [G.m.b.H.], subject only to the
possibility of striking out under Ord. 18, r. 19. That accordingly is, in my
judgment, the proper criterion to apply."
In effect he was saying that as the joinder of G.m.b.H. did not require
leave under R.S.C., Ord. 11, the striking out criterion was the criterion to
apply. It is of course well known that a claim will only be struck out in a
plain and obvious case. It is a difficult criterion for defendants.
This is, however, a Brussels Convention case. Under section 2(1) of the
Civil Jurisdiction and Judgments Act 1982, the Brussels Convention on
Jurisdiction and the Enforcement of Judgments in Civil and Commercial
Matters 1968 has the force of law in the United Kingdom and judicial
notice is to be taken of it.
Under section 3(1) of the Act, "Any question as to the meaning or
effect of any provision of the Conventions shall, if not referred to the
European Court in accordance with the 1971 Protocol, be determined in
accordance with the principles laid down by and any relevant decisions of
the European Court."
There are certain further matters in section 3 as to taking judicial notice
of decisions of the Court of Justice of the European Communities and
as to the travaux preparatoires that were antecedent to the original
Convention, the Protocol of 1971 on the Interpretation of the Convention
of 1968 and the Convention of 1978 on the Accession to the Convention
of 1968 and the Protocol of 1971 of Denmark, the Republic of Ireland and
the United Kingdom.
Section 42 of the Act provides: "(1) For the purposes of this Act the
seat of a corporation or association (as determined by this section) shall
be treated as its domicile.... (6)... a corporation or association has its
seat in a state other than the United Kingdom if and only if -- (a) it was
incorporated or formed under the law of that state and has its registered
office or some other official address there; or (b) its central management
and control is exercised in that state."
It is not in doubt that the seat and, therefore, the domicile of G.m.b.H.
are in Germany and nowhere else.
I come then to the Convention of 1968 itself. Article 2 provides: "Subject
to the provisions of this Convention, persons domiciled in a contracting
state shall... be sued in the courts of that state...." Article 3 provides:
"Persons domiciled in a contracting state may be sued in the courts of
another contracting state only by virtue of the rules set out in sections 2
to 6 of [Title II of the Convention]."
These include, as the only possible alternative candidates to pursuing
G.m.b.H. in Germany, articles 5(3) and 6. Article 6 provides:
"A person domiciled in a contracting state may also be sued: (1) where he
is one of a number of defendants, in the courts for the place where any
one of them is domiciled;..."
In relation to article 6, we have the benefit of the decision of the Court of
Justice in Kalfelis v. Bankhaus Schroeder, Muenchmeyer, Hengst and Co.
(Case 189/87) [1988] E.C.R. 5565 and also of the decision of this court
in The Rewia [1991] 2 Lloyd's Rep. 325. I should refer briefly to the views
expressed in relation to article 6 in the Kalfelis case in answer to the first
question raised in that case. The judgment reads, at pp. 5583-5584:
"8. The principle laid down in the Convention is that jurisdiction is
vested in the courts of the state of the defendant's domicile and that the
jurisdiction provided for in article 6(1) is an exception to that principle. It
follows that an exception of that kind must be treated in such a manner
that there is no possibility of the very existence of that principle being
called in question.... "10. In order to ensure, as far as possible, the
equality and uniformity of the rights and obligations under the Convention
of the contracting states and of the persons concerned, the nature of
that connection must be determined independently. "11. In that regard,
it must be noted that the above-mentioned report" -- that is, one of the
travaux preparatoires -- "prepared by the committee of experts referred
expressly, in its explanation of article 6(1), to the concern to avoid the
risk in the contracting states of judgments which are incompatible with
each other. Furthermore, account was taken of that preoccupation in the
Convention itself, article 22 of which governs cases of related actions
brought before courts in different contracting states."
It follows from the Kalfelis case and The Rewia that, where article 6 is
concerned, the test to be applied for joinder must be what I would call
briefly the Order 11 test – the test that would have been applied had
permission for service had to be obtained under Order 11.
In the present case there are certain facts which are put in evidence on
behalf of the plaintiffs in the eleventh affidavit of their solicitor, Mr. Wood.
He says:
"If the documents sought are not in the power of the second defendant,
the plaintiffs seek in the alternative to join... G.m.b.H. and [a body I
need not refer to further] as additional defendants. As will be apparent
from the foregoing, the plaintiffs' only purpose of joining these companies
is to obtain the discovery sought on this motion. The plaintiffs accept
that adequate relief can be obtained from the existing defendants if the
plaintiffs are successful."
The history of the matter was that a motion was issued claiming, as
the primary relief, specific discovery of certain classes of documents, as
against the second defendant, which had been added at an earlier stage
under Order 11. The motion also sought, in the alternative, that G.m.b.H.
should be added as a party to the action, with consequential relief. In the
event it appeared that the second defendant did not have the relevant
documents but G.m.b.H. did or probably did. Accordingly, the plaintiffs
proceeded with their alternative claim rather than with their claim for
further discovery against the second defendant.
We have not heard argument on this appeal from counsel for the
plaintiffs. Subject to that, however, I would take the view that if the
plaintiffs rested only on article 6, it would be improper to join G.m.b.H.
merely to obtain discovery, especially as there seems to be no doubt that
the requisite discovery could be obtained from G.m.b.H. in Germany by
an application in Germany under the Hague Convention on the Taking of
Evidence Abroad in Civil or Commercial Matters, to which Germany is also
a party.
However, article 5(3) is an independent ground for special jurisdiction
under the Brussels Convention. Article 5 provides:
"A person domiciled in a contracting state may, in another contracting
state, be sued... (3) in matters relating to tort, delict or quasi-delict, in
the courts for the place where the harmful event occurred;..."
Article 5(3) was also considered in the Kalfelis case [1988] E.C.R. 5565
on the second question which the Court of Justice there had to consider. I
shall read paragraphs 16 to 19 of the decision, at p. 5585:
"16. Accordingly, the concept of matters relating to tort, delict or quasi-
delict must be regarded as an autonomous concept which is to be
interpreted, for the application of the Convention, principally by reference
to the scheme and objectives of the Convention in order to ensure that
the latter is given full effect. "17. In order to ensure uniformity in all
the member states, it must be recognised that the concept of 'matters
relating to tort, delict and quasi-delict' covers all actions which seek
to establish the liability of a defendant and which are not related to a
'contract' within the meaning of article 5(1). "18. It must therefore be
stated in reply to the first part of the second question that the term
'matters relating to tort, delict or quasi-delict' within the meaning of
article 5(3) of the Convention must be regarded as an independent
concept covering all actions which seek to establish the liability of a
defendant and which are not related to a 'contract' within the meaning of
article 5(1). "19. With respect to the second part of the question, it must
be observed, as already indicted above, that the 'special jurisdictions'
enumerated in articles 5 and 6 of the Convention constitute derogations
from the principle that jurisdiction is vested in the courts of the state
where the defendant is domiciled and as such must be interpreted
restrictively. It must therefore be recognised that a court which has
jurisdiction under article 5(3) over an action in so far as it is based on tort
or delict does not have jurisdiction over that action in so far as it is not so
based."
It is not in doubt that patent infringement falls within the rubric in article
5(3), "matters relating to tort, delict or quasi-delict." It is also not in
doubt that, for the purposes of article 5(3), the "harmful event" was the
marketing of the allegedly infringing nappies in England; so the "harmful
event" occurred in England.
Infringement is not within the exclusive jurisdiction provisions of article
16, paragraph (4) of which refers to "proceedings concerned with the
registration or validity of patents" and other similar rights. In these
proceedings registration and validity are not in issue. But from the nature
of a United Kingdom patent, proceedings for infringement of a United
Kingdom patent can only be brought in a United Kingdom court, in the
present case the English court, and could only be founded on infringement
in England. The German court could entertain an action for infringement
of the comparable German patent, but could not entertain a claim for
infringement of an English patent. Conversely, the English court could not
entertain a claim for the infringement of a German patent. English patent
law as embodied in the Patents Act 1977 is founded on international
convention, not just European Community convention, but, subject to
certain special provisions of the Act, its application by the English court is
a matter of English law.
The relevant law has recently been further developed. For a very long
time there has been a dichotomy applied between "procuring" and
"facilitating" an infringement of a patent: see Townsend v. Haworth
(1875) 48 L.J.Ch. 770; Dunlop Pneumatic Tyre Co. Ltd. v. David
Moseley & Sons Ltd. [1904] 1 Ch. 164 and 612 and Belegging-en
Exploitatiemaatschappij Lavender B.V. v. Witten Industrial Diamonds Ltd.
[1979] F.S.R. 59, 65, where Buckley L.J. said: ""Facilitating the doing of
an act is obviously different from procuring the doing of the act." A person
who merely facilitated, but did not procure, the infringement was not a
joint tortfeasor with the infringer and so was not liable if, for instance,
he sold articles which could be used for infringing or non-infringing
purposes even though he knew that they would probably be used and
were intended to be used for the infringing purposes.
More recently, however, a new concept has been developed. Parties will
be regarded as joint tortfeasors if on the facts they have a common
design to market in the United Kingdom articles which in truth infringe
a United Kingdom patent. The first appearance of this doctrine seems
to have been in Morton-Norwich Products Inc. v. Intercen Ltd. [1978]
R.P.C. 501, a decision of Graham J. There, the common design was shared
by a Dutch company, which wanted to market in the United Kingdom
infringing goods for which it had no licence from the patentee, and the
Dutch company's English distributor. This common design, which the
Dutch company had furthered by its acts, rendered the Dutch company
liable as a tortfeasor in the English courts, although the Dutch company's
own acts in furtherance of the common design had all taken place abroad
and the plaintiff patentees had chosen not to sue the English distributor.
That concept of common design was adopted and elaborated by this court
in Unilever Plc. v. Gillette (U.K.) Ltd. [1989] R.P.C. 583. That decision is
of course binding on us as to the concept of joint infringement as a result
of common design. The case was concerned with the group arrangements
of a multinational group of companies. But it did not involve the Brussels
Convention, as only the United Kingdom subsidiary and the United States
parent were brought before the English court. The factors on each side
were summed up by Mustill L.J., at pp. 609-610. Shortly before that
summary he had said, at p. 609:
"I use the words 'common design' because they are readily to hand,
but there are other expressions in the cases, such as 'concerted action'
or 'agreed on common action' which will serve just as well. The words
are not to be construed as if they formed part of a statute. They all
convey the same idea. This idea does not, as it seems to me, call for any
finding that the secondary party has explicitly mapped out a plan with the
primary offender. Their tacit agreement will be sufficient. Nor, as it seems
to me, is there any need for a common design to infringe. It is enough if
the parties combine to secure the doing of acts which in the event prove
to be infringements."
In the present case, the plaintiffs rely, as the foundation of the common
design, on the allegations in paragraph 5 of the re-amended statement of
claim, elaborated by fairly lengthy voluntary particulars.
In paragraph 5 they assert:
"The acts of the first defendant in the United Kingdom so specified were
committed in pursuance of a common and concerted design between the
first, second and third defendants. In the premises the second and third
defendants are jointly liable with the first defendant therefor.
"Particulars
"(a) The first and third defendants are subsidiaries of the second
defendant. In the premises the first and third defendants are controlled
by the second defendant. (b) Development of the products in issue in
this action was carried out by the second and third defendants. (c) The
second defendant controls the worldwide manufacture and marketing of
the products in issue in this action. In particular the products referred
to in the amended particulars of infringements are manufactured for the
first defendant by the third defendant under the direction of the second
defendant."
In the voluntary particulars, which I do not intend to read here in full,
reliance is placed on a number of matters including the following under
heading A:
"(i) The introduction into the United Kingdom market of the products
complained of in the particulars of infringements was part of a European
plan agreed expressly or tacitly by the first and third defendants and
which plan was in turn part of a worldwide plan agreed expressly or tacitly
by all defendants. (ii) The European plan was co-ordinated by the third
defendant. In particular the third defendant was responsible for ensuring
that consensus existed between the various European subsidiaries of the
second defendant as far as possible as to the specification of the product
to be introduced and for determining the overall strategy for supply in all
the European markets.... (iv) The international nature of the production
and distribution operations of the P. & G. group, which the Europe and
worldwide plans exemplify, is so well known that any product introduced
in one European country can be expected to appear in other European
markets. (v) The defendants and each of them have treated the European
market as a single market, allowing minor differences in products sold
only in so far as they can be fitted in conveniently with their overall
strategy. In this manner a 'European roll out' of new or altered products is
achieved."
Then under heading B:
"(i) The third defendant has supplied the product complained of in the
particulars of infringements to the first defendant. The said product could
not be sold in the United Kingdom without infringing the patent in suit, as
the third defendant was well aware. (ii) The third defendant has with the
agreement of the first defendant tailored the alleged infringing product
to the specific requirements of the first defendant in the United Kingdom
market. (iii) The third and first defendants have co-operated extensively
in the marketing of the alleged infringing product in the United Kingdom.
Hereunder the plaintiffs will rely inter alia upon [certain statements of
representatives of G.m.b.H. in certain affidavits, and] (c) the consultation
which takes place between the third and first defendants over consumer
research, the European roll out and marketing methods referred to in [a
further affidavit] and (d) the marketing support, such as the provision of
market research test data, given to the alleged infringing product in the
United Kingdom and as evidenced... by [certain documents which have
been disclosed]."
The question then is: to what criterion must the plaintiffs establish that
case on an application by them to join G.m.b.H. in the action, or on an
application by G.m.b.H. or the other defendants to have the joinder of
G.m.b.H. or service on G.m.b.H. set aside? I have no doubt that in a
Brussels Convention case, as opposed to a case where all the alleged joint
tortfeasors are domiciled in this country, the plaintiffs must show that
they have "a good arguable case."
For the purposes of the present case, I agree with the interpretation of
that phrase given by Nicholls L.J. in giving the leading judgment in this
court in Tesam Distribution Ltd. v. Schuh Mode Team G.m.b.H. [1990]
I.L.Pr. 149. The plaintiff's claim there was that the defendants, a supplier
of shoes and a bank, both domiciled in Germany and not in England
or Wales, had made a contract with the plaintiff, an English-domiciled
importer and distributor of shoes, to supply the plaintiff with shoes in
England and had broken that contract by failing to deliver the shoes in
England. The plaintiff therefore relied, for material purposes, on article
5(1) of the Brussels Convention, which provides:
"A person domiciled in a contracting state may, in anothercontracting
state, be sued: (1) in matters relating to a contract, in the courts for the
place of performance of the obligation in question."
The defendant bank disputed the existence of the alleged contract.
Nicholls
L.J. said, at p. 154:
"[11] Shortly stated, the bank's case is that the plaintiff has not got
over the threshold which, under the Convention, must be cleared before
an English court has jurisdiction to hear and determine the plaintiff's
claims that the bank is in breach of contract or has committed the tort
of inducing a breach of contract by the first defendant. [12] Thus the
first matter which has to be considered is what is the test which the
English court should apply on this interlocutory application, when there is
a dispute whether the contract alleged was made or the tort alleged was
committed."
He then turned to the Convention and he referred among other authorities
to Kalfelis v. Bankhaus Schroeder, Muenchmeyer, Hengst and Co. (Case
189/87) [1988] E.C.R. 5565. He set out the submission for the bank at p.
157:
"for an English court to have jurisdiction to hear and determine the claim
that the bank is in breach of contract, the plaintiff must satisfy the English
court at the interlocutory stage that, on the evidence put forward by the
plaintiff, and disregarding any conflicting evidence put forward by the
bank, the plaintiff's claims in this action are well founded, viz., that they
will succeed."
Nicholls L.J. rejected that formulation. After referring to the decision of
the Court of Justice in Effer S.p.A. v. Kantner (Case 38/81) [1982] E.C.R.
825, he said [1990] I.L.Pr. 149, 158:
"[22]... I do not think that in paragraph 7 of its decision the European
[Court of Justice] was saying more than that, faced with a claim founded
on a] contract whose existence is in dispute, the national court has
jurisdiction to consider and determine the existence or not of the contract,
having regard to sufficient and
proper evidence adduced by the party concerned."
He then continued, in a section of his judgment headed "A serious
question to be tried:
"[23] This is not to say that the bare assertion of the existence of a
contract is the end of the matter on an interlocutory application such as
this. Far from it. The English court has ample powers of its own to see
that the jurisdiction which it is given by article 5(1) of the Convention is
not abused. When leave to serve a writ out of the territorial jurisdiction
of the English court is needed under Ord. 11, r. 1(1), leave is not granted
unless it is made sufficiently to appear to the court that the case is a
proper one for service out of the jurisdiction: see Ord. 11, r. 4. To satisfy
that requirement a good arguable case must be made out: see per Lord
Simonds in Vitkovice Horni a Hutni Tezirstvo v. Korner [1951] A.C. 869,
879, 880. Ord. 11, r. 1(1) does not apply in the present case. Jurisdiction
under the Convention is not a matter of discretion. Nevertheless, bearing
in mind that jurisdiction under article 5 is an exception to the general rule
under article 2, the English court will be astute to see that frivolous or
vexatious claims for the existence of a contract are stopped summarily at
the outset, either under Ord. 18, r. 19 or under the inherent jurisdiction
of the court. There must be evidence establishing a genuine and real
dispute. The court should be satisfied that there is a serious question
which calls for a trial for its proper determination. [24] If at the outset,
when the court is considering whether it has jurisdiction to entertain the
claim under article 5(1) it is apparent that the claim has no real prospect
of succeeding, the court should say so and decline to permit the action to
proceed."
Nicholls L.J. then examined the evidence in the case before him, and
reached his conclusion, at p. 160:
"[30] The plaintiff's case is not without its difficulties, but in my view the
plaintiff has established that there is here a serious question which calls
for a trial for its proper determination..."
Stocker L.J. delivered a concurring judgment. He said, at p. 166:
"[49] The most appropriate standard by which the matter should be
judged on an application in this form seems to me to be that appropriate
to applications to serve out of the jurisdiction under Order 11, viz., a
good arguable case, and this is so even though the matter is not one of
discretion where service is pursuant to rule 2(a)."
I have no doubt that Stocker L.J. was using the phrase "a good arguable
case" in the sense used by Nicholls L.J. O'Connor L.J. agreed.
That is in line with the test stated by Mustill L.J. in Unilever Plc. v. Gillett
(U.K.) Ltd. [1989] R.P.C. 583, 602:
"This is a matter for a trial judge to decide in the light of all the
circumstances, not for a court to rule upon as if the relevant paragraph
of the amended statement of claim were an agreed statement of facts,
prepared for the argument of a preliminary question of law. I quite accept
that if there are no circumstances which could imaginably come out at the
trial, to furnish a context for the four bald facts asserted in the pleading,
which could give Unilever any fair prospect of persuading a judge to make
the required inference, then we should say so now: and indeed I believe
that this is just what the learned judge has said in the judgment under
appeal. But if the inference is a fair possibility, we should not go further
and set ourselves up to decide at this stage whether or not it should be
drawn."
Mustill L.J. picked that up later, at p. 610:
"We are not however concerned at this stage to try the issue of
participation. Our task is simply to consider whether when the undisputed
facts are set in the context of a full exploration of the background, the
plaintiffs will have a’good arguable' case to advance before the judge, to
the effect that there was a meeting of minds between Boston and G.U.K.
with a view to furthering the sale of products containing Apache in the
United Kingdom in whatever manner and to whatever degree G.U.K.
might decide, in the light of their judgment of the local market. For my
part I think it clear that they will, and without expressing any opinion on
the likely outcome, I consider that the case is one which is appropriate in
principle for the grant of leave under Order 11."
Mr. Thorley, for the defendants, has urged on us what he submits is a
more stringent criterion for the purposes of Order 11 laid down in the
judgment of Staughton L.J. in Attock Cement Co. Ltd. v. Romanian Bank
for Foreign Trade [1989] 1 W.L.R. 1147. There, Staughton L.J., with
whose judgment the other members of the court agreed, said, at p. 1155:
"Nevertheless I conclude that, where there is a disputed question of
fact which is essential to the application of R.S.C., Ord. 11, r. 1, the
judge must reach a provisional or tentative conclusion that the plaintiff
is probably right upon it before he allows service to stand. The nettle
must be grasped, and that is what I take to be meant by a good arguable
case."
Staughton L.J.'s test would certainly, I apprehend, be the prudent
course if, as in many Order 11 cases, the issue under consideration on
the Order 11 application is one which will never be tried at the trial of
the action if leave under Order 11 is granted. But I have difficulty in
treating it as a ruling of general application in all cases under Order 11
or the Brussels Convention, and as displacing authoritively the approach
adopted by Nicholls L.J. and the other members of the court in the
Tesam case and Mustill L.J. and the other members of the court in the
Unilever case. Indeed, if an action for patent infringement were brought
alleging infringement of claims in a highly complicated chemical or
mathematical patent, or a patent in the field of genetic engineering, for
example, it would be strange if the court really had to form the view on
the application for joinder of parties, if service was to stand, that the
plaintiff was probably right that the patent had been infringed as alleged.
For my part, for the purposes of this case I would prefer and apply
the test set out by Nicholls L.J. When the action comes on for trial the
plaintiffs will, in the absence of admissions, have to prove at the trial their
pleaded allegation that G.m.b.H. and the first defendant had a common
design, with or without the second defendant, to market the infringing
products in England. If the common design is proved there will no doubt
not be much difficulty in proving that G.m.b.H. furthered the common
design by manufacturing and supplying the nappies and doing such other
of the acts relied on in the pleading as are proved at the trial. In my
judgment, on the evidence before us the plaintiffs have shown a good
arguable case, by Nicholls L.J.'s criterion, that G.m.b.H. had a common
design with the first defendant as pleaded.
Hoffmann J. in his judgment in the court below said:
"I realise that the effect of the line of cases which starts from the Unilever
decision is coming close to producing a situation in which, in the case
of a multinational corporation, it will almost invariably be the case that
a member of the group which is sufficiently involved in the alleged
infringement to have documents which are discoverable will also be
sufficiently involved to give rise to at any rate an arguable case that it
is a joint tortfeasor. The effect of the doctrine is, therefore, to extend
the range of discovery to other members of the group. Whether this is a
good thing or not is not really for me to say. It does seem to be a likely
consequence of applying that decision."
With the qualification that the test for joinder is "a good arguable case"
rather than the striking out test which Hoffmann J. applied, I would agree
with that paragraph.
Does the fact that the plaintiffs' only purpose in joining G.m.b.H. is to
obtain discovery of relevant documents which are not in the possession
of the first or second defendants, as candidly stated by Mr. Wood in the
passage I have read from his affidavit, make it an abuse of process or
improper for the plaintiffs to rely on article 5(3) as opposed to article
6 of the Convention? Having heard and considered the arguments of
Mr. Thorley, I am firmly of the view that it does not. The English court
has power to control the process of discovery in English proceedings.
In the present case, G.m.b.H. has merely been ordered to disclose the
documents covered by the request for additional discovery originally
aimed at the second defendant; there has been no general order for
discovery. The process of the English court is well capable of preventing
oppressive demands against a party who has been joined in such
circumstance as those of the present case. I should, however, also
proceed to read the next two sentences in Mr. Wood's affidavit after the
passage which I have already cited:
"Nevertheless, I believe that the plaintiffs have a right to proceed against
these companies if, as the plaintiffs contend, they have participated in a
common and concerted design with the existing defendants to infringe the
patent in suit. The plaintiffs believe that the discovery sought is necessary
for fairly disposing of the action, and accordingly joinder is necessary if
the documents are not in the power of the second defendant."
Article 5(3) is an independent qualification of article 2 of the Convention.
It applies where there is a remedy in tort, delict or quasi-delict available
against, on the facts of this case, G.m.b.H. in this country. It is long
established that a plaintiff who has been injured by a number of joint
tortfeasors can choose which he will sue. He does not have to sue all of
them. But the defendants have no right whatsoever to dictate which the
plaintiff shall sue or to make the choice for him. If at the trial the plaintiffs
succeed in establishing infringement and common design they will be
entitled to judgment for damages for infringement against G.m.b.H. as
well as against the first and possibly second defendants. They will be able
to choose which to enforce the judgment against. It is unnecessary to
consider some of the more sophisticated alternative forms of relief which
may or may not be available to the plaintiffs against G.m.b.H. separately
from other relief available against the first defendant.
I see no abuse in these circumstances, where there is a good arguable
case for a cause of action by English law, in joining G.m.b.H. in the action
with the particular aim of obtaining discovery of documents relevant to
the claims against the first and second defendants as well as to the claim
now legitimately pleaded against G.m.b.H. The existence of rights under
the Hague Convention does not deprive the plaintiffs of their right to
sue G.m.b.H. as joint tortfeasor. It is not enough for Mr. Thorley to say
that the plaintiffs do not need to sue G.m.b.H. to get the discovery they
desire.
I have considered whether we should direct a reference to the Court of
Justice for a ruling on the interpretation of the Brussels Convention under
articles 1 and 2(2) of the Protocol of 1971 in Schedule 2 to the Act of
1982. But having formed a firm view on all the issues, I do not find that
necessary. I would accordingly dismiss the appeal.
WOOLF L.J.
I agree in general that the appeal should be dismissed for the reasons
given by Dillon L.J. I should, however, say something about the vexed
question of what constitutes "an arguable case" to which reference has
been made by Dillon L.J. in the context of the Brussels Convention and
which is also a matter of considerable importance in relation to R.S.C.,
Ord. 11.
In Tesam Distribution Ltd. v. Schuh Mode Team G.m.b.H. [1990] I.L.Pr.
149, to which Dillon L.J. has referred, in addition to the passage which he
cited from the judgment of Stocker L.J., Stocker L.J. said, at p. 165:
"[45] In my view the effect of Effer S.p.A. v. Kantner (Case 38/81)
[1982] E.C.R. 825 is that a court other than a court of the defendant's
country of domicile cannot accept jurisdiction on the mere assertion or
pleading of the plaintiff. There must be evidence adduced from which a
conclusion could properly and genuinely be drawn that a contract existed
and that the place of performance was the country in which the action
was brought. Once jurisdiction can properly be established on this basis
then the effect of article 5(1), in the light of the Effer v. Kantner decision
is that the court has jurisdiction finally to determine the issues between
the parties. If after full trial the conclusion is that no contract existed then
since the court had jurisdiction to try the issue that determination is final
and binding upon the parties."
As I understand the judgments of both Stocker and Nicholls L.JJ. in that
case, they were presupposing a situation where the issue which was
determinative of jurisdiction would also, if the case proceeded to trial, be
subject to a final determination at the trial.
In Attock Cement Co. Ltd. v. Romanian Bank for Foreign Trade [1989] 1
W.L.R. 1147, to which Dillon L.J. has referred, and to which I was a party,
the situation before the court was somewhat different and the judgment
of Staughton L.J. was given in the light of an argument which was fully
presented to the court having regard to the issue which was there being
considered. The vital issue going to jurisdiction in the Attock Cement case
was a conflict of oral evidence as to the existence of an oral agreement
which, if one party was right, would confer a jurisdiction the existence of
which the other party denied. If the court in the Attock Cement case had
come to the conclusion that there was jurisdiction, then that issue would
not in all probability have been redetermined at the trial. The fact that
there was a conflict before the court -- one witness said in his evidence
that there was an oral agreement and the other witness said there was
no oral agreement -- meant that the court, in Staughton L.J.'s language,
at p. 1155H, was in a situation where "the nettle must be grasped."
In a situation where what has to be established is jurisdiction in those
circumstances, in order to decide whether or not there is a good arguable
case, the court has to come to a conclusion, without trying the matter
in the same way as it would do if the situation was one where there was
to be a full trial, on the affidavit evidence, that one view is preferable to
another. It is in that context, as I understand it, that the passage in the
judgment of Staughton L.J. has to be understood. Staughton L.J. began
by saying, at p. 1152:
"No doubt the master or judge will refuse leave ex parte if the plaintiff's
evidence is, in a word, incredible. Otherwise he will grant leave if the facts
deposed to satisfy R.S.C., Ord. 11, r. 1. Nothing that I say touches on the
practice at that stage."
He then went on to deal with the argument which had been advanced by
counsel, who had been seeking to establish jurisdiction, which Staughton
L.J. summarised in these terms, at p. 1153:
"[Counsel] submits that this is indeed the law. He acknowledges that the
court may decide against the owners if it finds their evidence 'incredible,'
for there is not then a good arguable case. Otherwise, he submits, the
court must accept the owners' evidence."
The argument which was being put forward there was that in effect the
court was required to disregard the evidence contrary to the owners'
evidence when evaluating the evidence on which the owners were seeking
to rely. Staughton L.J. then cited extensively from the House of Lords'
decision in Vitkovice Horni a Hutni Tezirstvo v. Korner [1951] A.C. 869 and
said, at p. 1155:
"It is to my mind plain from the Vitkovice case that a master or judge
may on some occasions" -- and I emphasise the words "on some
occasions" -- "find himself obliged to assess the relative strength of the
plaintiff's and the defendant's case. In doing so he does not try the case
upon affidavits, because he reaches only a provisional conclusion; the
stage for trial and for final decision has not been reached. But he must
have regard to all the admissible material before him, as Lord Simonds
and Lord Radcliffe said -- not just the plaintiff's case. He must conclude
that there is a good arguable case (Lord Simonds) -- not just a case that
can be argued; or a strong argument (Lord Radcliffe). What need not be
shown is that the plaintiff is right beyond all reasonable doubt."
The surprising reference there to "all reasonable doubt" is understandable
because of the reference to "beyond all reasonable doubt" which appears
in certain of the speeches in the House of Lords in the Vitkovice case. It is
after those passages from his judgment which I have cited that Staughton
L.J. went on to say, at p. 1155:
"Nevertheless I conclude that, where there is a disputed question of
fact which is essential to the application of R.S.C., Ord. 11, r. 1, the
judge must reach a provisional or tentative conclusion that the plaintiff
is probably right upon it before he allows service to stand. The nettle
must be grasped, and that is what I take to be meant by a good arguable
case."
I agreed with the judgment of Staughton L.J. in the Attock Cement case.
In the context of the comments which I have just made, I find no reason
to alter my agreement with that passage of the judgment. Where there
is a conflict of the sort that was before the court in the Attock Cement
situation, the court, in my judgment, has no alternative but to tackle the
matter on the lines indicated by Staughton L.J. In practice, however, I
venture to think that whether you apply the test indicated by Nicholls L.J.,
or the test which was slightly differently expressed in the passage I have
cited from Stocker L.J., or the test indicated by Staughton L.J., in the
majority of, if not in virtually all, cases the court will come to exactly the
same conclusion. In this case I would have come to the same conclusion
whichever test was applied.
The only other matter to which I should refer is article 6(1) of the
Brussels Convention. The relationship of that article with the Hague
Convention is a matter on which, in the absence of full argument – indeed
we have not heard any argument from the plaintiffs on this appeal – I
would like to reserve my position.
LEGGATT L.J.
I express no opinion about the standard of proof required when, for the
purposes only of discovery, a corporation is sought to be joined as a
joint tortfeasor which has its domicile within the jurisdiction. With that
reservation, I agree that, for the reasons given by Dillon L.J., this appeal
should be dismissed. Representation
Solicitors: Simmons & Simmons; Hopkins & Wood.
Appeal dismissed with costs. Leave to appeal refused (…