LORD PROSSER.
In this admiralty action, the pursuers seek damages from the defenders in
respect of an alleged breach of contract. It is said that a cargo belonging
to the pursuers, which was being carried on a vessel belonging to the
defenders, was discharged in circumstances which amounted to a breach
of the contract between the parties. The summons in the action contained
a warrant for arrestment, on the dependence, of another vessel, the
Marian Buczek, also belonging to the defenders and lying in Aberdeen.
The case came before me on the motion roll, when the defenders moved
for release of this arrestment, and also for caution. I refused both of
these motions. While I gave a brief oral explanation as to my reasons
for doing so, I indicated that I did not think it suitable to write upon the
matter, although I would of course do so if the defenders were to reclaim.
The defenders have now reclaimed.
In relation to the motion for caution, the defenders advanced no
argument or authority which would, in my opinion, warrant an order for
caution in circumstances such as the present. I have no more to say
about that matter.
In seeking recall of the arrestment on the dependence of the action,
counsel for the defenders acknowledged that he could only succeed if he
could show that the pursuers' pleadings disclosed no "colourable" case.
He acknowledged also that for this purpose, one was not considering
whether the pleadings disclosed a relevant case. At this early stage,
with incomplete pleadings (and indeed no defences), the pursuers'
pleadings might well be open to some criticism, and fall short of what
would be required for proof. Nonetheless, if the court considered that the
summons disclosed that there was a colourable or potentially arguable
case to be made by the pursuers, the arrestment could not be recalled.
Moreover, in the present case, counsel for the defenders acknowledged
that the pursuers' pleadings did disclose a colourable or arguable case
upon the merits of the action; and no question was raised in relation to
quantification of damages.
The sole point upon which it was contended by the defenders that the
summons lacked a colourable basis was in relation to the matter of
jurisdiction. In addition to the warrant for arrestment on the dependence,
the summons contained warrant for arrestment ad fundandam
jurisdictionem. Counsel for the defenders pointed out (and it was indeed
accepted on behalf of the pursuers) that there was no other basis for
jurisdiction. Unless the circumstances set out in the summons showed this
to be a situation in which arrestment ad fundandam jurisdictionem could
at least colourably be said to provide jurisdiction, recall of the arrestment
on the dependence would be appropriate.
In contending that there was no colourable basis for jurisdiction, counsel
for the defenders advanced two separate lines of argument. First, and
upon a general basis, he contended that on consideration of the law on
jurisdiction, it could be seen that jurisdiction could not be established,
in any action of this type, upon the basis of arrestment ad fundandam
jurisdictionem. And secondly, and more particularly, he contended that
in terms of the relevant bills of lading in the present case, the provision
in cl 3 of the bills, to the effect that any dispute should be decided in the
country where the carrier had his principal place of business, amounted to
prorogation of a foreign jurisdiction, with the effect that any jurisdiction
which the Scottish courts might otherwise have was wholly excluded. It
was submitted that there was no colourable basis for rejecting either of
these lines of argument.
In relation to the general argument on jurisdiction, I was of course
referred to the Civil Jurisdiction and Judgments Act 1982, the Brussels
Convention set out in Sched 1 to that Act, and the rules as to jurisdiction
in Scotland set out in Sched 8, along with the exclusions contained in
Sched 9. In terms of s 2 of the Act, the Brussels Convention has the force
of law in the United Kingdom. On the basis that the present defenders are
domiciled in Luxembourg, one of the contracting states, arts 2 and 3 of
the Brussels Convention are applicable. The defenders, in terms of art 2,
must be sued in the courts of Luxembourg, subject to the other provisions
of the Convention. Moreover, in terms of art 3, the pursuers are debarred
from founding jurisdiction upon seizure of property. These provisions
showed that at least prima facie arrestment ad fundandam jurisdictionem
could not provide a basis for Scottish jurisdiction against the defenders.
While counsel for the defenders took these provisions as providing the
basic rules for jurisdiction, he had to acknowledge the provisions of art
57 of the Brussels Convention, in terms of which that Convention is not
to affect any Conventions to which the contracting states are or would be
parties and which "in relation to particular matters, govern jurisdiction".
He accepted that in terms of that article the pursuers could "get round"
art 3 of the Brussels Conventionif there were another Convention which,
in relation to this particular matter, governed jurisdiction. He drew
my attention to (and the pursuers of course founded upon) the 1952
Convention relating to arrestment. In particular, I was referred to art7
of the 1952 Convention, as possibly providing Scottish jurisdiction, if
the "domestic law" of Scotland permits it. The search for the "domestic
law" of Scotland would bring one back to s 20 of the 1982 Act, and the
provisions of Sched 8 in effect provided a new formulation of the domestic
law of Scotland in relation to jurisdiction. Like the Brussels Convention
itself, one finds that subject to the subsequent rules, persons are, under
rule 1 of Sched 8, to be sued in the courts for the place where they are
domiciled. In terms of Sched 8, therefore, arrestment ad fundandam
jurisdictionem would not apparently provide jurisdiction. On the other
hand, counsel for the defenders had to accept, as was argued by counsel
for the pursuers, that in terms of s 21 of the 1982 Act, Sched 8 does not
affect the jurisdiction of any court in respect of any matter mentioned
in Sched 9, and in terms of Sched 9, item 6 is "Admiralty causes in so
far as the jurisdiction is based on arrestment in rem or ad fundandam
jurisdictionem of a ship, cargo or freight". That being so, Sched 8 does
not help and one is left with s 20 of the 1982 Act, the provisions of which
are expressly subject to Pts I and II of the Act. According to counsel for
the defenders, the domestic law of Scotland in this case would therefore
be as laid down in the Brussels Convention, which has effect in terms
of those parts of the 1982 Act. One thus came back to the position that
there could be no jurisdiction based on seizure of property.
I must confess to having found some difficulty in being taken round in
these various circles, or indeed downward spirals. Without going into the
details of the submissions advanced on behalf of the pursuers, it appears
to me that there is an at least colourable argument to the effect that
the substantive provisions of the Brussels Convention are not here in
point, since art 57 of that Convention may have the effect of giving the
1952 Convention primacy, insofar as it deals with jurisdiction in a case
of this type. The 1952 Convention can in turn colourably be argued to
give primacy, in a case of this kind, to the domestic law of Scotland, and
while for many purposes that law will be found in Sched 8 to the 1982
Act, it can at least colourably be argued that Sched 8 has nothing to do
with the matter, since this is one of the types of action excluded from
Sched 8 by the express terms of Sched 9. While I appreciate that broadly
speaking one may regard the provisions of the Brussels Convention as
providing the domestic law of Scotland on jurisdiction, in cases where
Sched 8 does not do so more specifically, there is something mildly odd or
paradoxical if art 57 and the 1952 Convention have taken us away from
those provisions, in holding that one is sent back to them by virtue of the
reference in the 1952 Convention to our domestic law. The element of
oddity or paradox is increased if one is being driven in this direction due
to the inapplicability of Sched 8 to the 1982 Act, that non-applicability
resulting precisely from the acknowledgment in Sched 9 that there will be
admiralty causes in which the jurisdiction is based on arrestment in rem
or ad fundandam jurisdictionem. To proceed from a position that this is
such an action, to the conclusion that it cannot be so, is a little strange.
Perhaps the various circles can be broken in the way suggested on behalf
of the defenders. My own inclination is to think that they cannot, and
that the broad new codes regulating jurisdiction, both in the Brussels
Convention and in Sched 8 to the 1982 Act, leave unaffected the pre-
existing domestic law of Scotland in admiralty causes where, according to
that pre-existing law, arrestment ad fundandam jurisdictionem provided
a basis for jurisdiction. Whether that is right or not, it appears to me that
a colourable argument to that effect exists, and is sufficiently invoked by
the terms of the pursuers' pleadings.
I would add that on a question as to jurisdiction, it appears to me that
any defender is in some difficulty in contending that the pursuers have
not made a colourable case. Where, as here, the argument is advanced
before any defences have been lodged, or any plea to jurisdiction taken,
one will not normally find much about jurisdiction in the pursuers'
pleadings. This is not a case where there is no purported basis for
jurisdiction. The basis is clearly stated as being founded upon arrestment
ad fundandam jurisdictionem. That being so, the substance of any dispute
as to jurisdiction would normally be found in the defenders' pleadings and
pleas, identifying some alleged defect or flaw. The "colourability" of the
pursuers' position would normally thus be judged in terms of what he can
say in reply, once he has been faced with some alleged identifiable defect
in the jurisdiction upon which he founds. In the absence of defences
identifying a flaw, I suspect that I would usually be reluctant to hold that
jurisdiction had not been colourably averred. At all events, in this case,
it appeared to me that there was a colourable basis for jurisdiction on
the pleadings with which I was faced. I was also faced with what was, in
effect, a full debate on relevancy. I did not, however, think it appropriate,
either in terms of the issue before me or in terms of the state of the
pleadings, to try to resolve any issue of relevancy. The question of recall
of arrestments may of course arise again in the context of defences and
the pursuers' response to them. But that will be a different question from
the one facing me, and it did not appear to me to be useful to attempt a
full resolution of matters in such a changing situation.
I turn to the second argument advanced on behalf of the defenders,
to the effect that Scottish jurisdiction, if any, had been excluded by
the terms of the bills of lading. In relation to a prorogation provision,
allegedly ousting Scottish jurisdiction, the comments which I have just
made in relation to pleadings appear to me to be equally applicable. It
would normally be for defenders to plead that jurisdiction was ousted,
rather than for pursuers to have detailed averments as to why they say
it has not been ousted. The colourability of their position is therefore
again, in my view, something that can only be satisfactorily judged when
one sees their response to some specific point taken against them. In
the present case, the prorogation clause, to have effect, would require
ascertainment of "the country where the carrier has his principal place
of business". On the pursuers' pleadings, it is averred that the defenders
between them owned all the shares of the carrying vessel at all material
times, and it is averred that the defenders are the carriers referred to
in the prorogation clause. The pursuers, however, aver that they do not
know whether the defenders have their principal place of business at their
respective registered offices, at their place of business in Luxembourg or
elsewhere, and that they do not know whether the defenders both have
the same principal place of business. I was referred by counsel for the
defenders to certain affidavits and other productions, which were said to
show not only that the first defenders had their principal place of business
in Luxembourg, but to show that the vessel had been chartered to the
first defenders (by the first and second defenders) so that they alone
were the carriers. It was, I think, accepted by counsel for the defenders,
and it is in any event my view, that if the second defenders were carriers
along with the first defenders, then it might be impossible for me to reach
a decision at this stage on the issues put to me. It appears to me that
there are indeed doubts as to who were the carriers, for the purposes
of the prorogation clause, and as to whether the second defenders in
particular have any particular principal place of business. There are
potential problems if there are two carriers, with their principal places of
business in different countries. There is also at least a question, raised by
counsel for the defenders, as to whether a clause of this type results in
a total absence of jurisdiction, or merely means that there is a possible
objection to jurisdiction which, if properly pled, might succeed. There
is a further question as to whether the proper course would be to sist
the action, or to dismiss it, if such a point were taken. The issue of
prorogation appears to me to be one with various complexities which
make it quite impossible to say that the pursuers have no colourable case
in advance of seeing precisely what point or points the defenders can
make in their own pleadings which would call for some response, perhaps,
in the pursuers' adjusted pleadings. If there is to be a further hearing
in the Outer House (or indeed if the pleadings have changed before any
potential hearing in the Inner House) I do not think that it is useful for me
to go into the matter in further detail, in the context of the pleadings and
submissions which were presented to me.