"(...) HIS HONOUR JUDGE HEPPEL QC:
INTRODUCTION
1.On the 11th January 2000 the Claimant, Sarah Summers, was a pillion
passenger on a motor cycle driven by Thomas Stubbs (Stubbs) in the
course of his employment with IPC Media Limited (IPC). Stubbs was riding
along Via Manzoni in Milan in fog. It is said that he collided with a part of
the pavement that had been widened so as to protrude into the roadway
in the vicinity of the Armani shop (the “outbuild”). Miss Summers suffered
devastating injuries. Her Particulars of Claim allege the law applicable
to the accident is English law. She claims damages under such heads
as would normally be the case for catastrophic injuries (in excess of
£1m.). Stubbs and his employer denied liability. In essence, however,
their argument related to contributory negligence because Miss Summers
was not wearing a crash helmet. They averred the appropriate law is the
law of Italy. They failed to get permission to appeal the Order of District
Judge Mostyn at the Milton Keynes Registry of the 12th October 2001
giving summary judgment on the issue of primary liability in favour of the
Claimant with issues of causation concerning the crash helmet point and
quantum to be decided in due course. The trial of these issues is yet to
take place.
2.The District Judge gave Stubbs permission to take Part 20 proceedings
against his Italian Insurers, SAI, who had refused to indemnify him
against the claim. It is submitted on behalf of Stubbs that SAI’s liability
would be only a small proportion of the damages likely to be awarded
to the Claimant by an English court. SAI has taken no part in the
proceedings and has been deemed to admit the claim under CPR Pt
20.11.2.
3.This court is concerned with the second set of Part 20 proceedings
brought by Stubbs and IPC against Comune di Milano (Milan) and Azienda
Transporti Milanesa SpA (ATM). The two Part 20 claimants claim a
contribution from each under the Civil Liability (Contribution) Act 1978 or
otherwise, on the basis (put simply) that Milan authorised or permitted
ATM (a tram company) to widen the pavement such that as constructed it
was a danger to road users (dangerous obstruction, insufficient warning
signs etc). It is averred that each is liable for damage suffered by the
Claimant under Articles 2043 and 2051 of the Italian Civil Code, liable in
respect of the same damage as Stubbs and IPC and thus liable to make a
contribution under the 1978 Act.
4.Part 20 proceedings have been served on Milan and ATM without
permission, pursuant to CPR Part 6.19 on the basis that the English court
has jurisdiction under Article 6(2) of the Brussels Convention. ATM has
acknowledged service without disputing jurisdiction. In a letter to the
court, ATM’s English solicitor’s write that ATM support the position of
Stubbs and IPC in the applications before this court, but in order to save
costs do not appear. Likewise, solicitors for the Claimant write that Miss
Summers does not appear, but does not consent to Milan’s application.
The Applications before the court
5.By application dated the 24th January 2002 Milan applies for a
declaration that the court has no jurisdiction over it, and for an Order
that, inter alia, service of the Part 20 claim form and Particulars of Claim
be set aside. In summary, Milan submits that the Part 20 cause of action
against it does not fall within the Convention; alternatively if it does, that
Milan is for these purposes outside the reach of Article 6(2); in the further
alternative, Milan submits that if it is caught by Article 6(2) the court
should nevertheless exercise a residual discretion to decline jurisdiction.
Stubbs and IPC strenuously oppose the application on all grounds, but in
the event of Milan’s application succeeding they seek permission to serve
out of the jurisdiction pursuant to CPR Part 6.20 and 6.21.
6.Milan’s application came before Holland J, who by order of the 24th
April 2002 adjourned it to enable the parties to submit expert evidence
relating to the corpus of national legal systems and Italian law. It was
shortly before that hearing that Milan indicated it wished to argue that
the Convention did not apply to this case (as opposed to whether Stubbs/
IPC could bring the case within Article 6(2)). The expert evidence is now
before the court. I shall deal in turn with the three principal submissions.
The Brussels Convention: Article 1
7.The Brussels Convention (now replaced by Regulations) has the force
of law within the United Kingdom by virtue of S.2 Civil Jurisdiction and
Judgments Act 1982. Judicial notice is to be taken of decisions of the
European Court on Convention matters and consideration may be given to
reports submitted by Mr P Jenard and Professor Schlosser (S3).
8.As amended, Article 1 reads (so far as is material)
“This Convention shall apply in Civil and Commercial matters whatever
the nature of the court or tribunal. It shall not extend, in particular, to
revenue, customs or administrative matters.”
Specific reference to administrative matters was inserted at the request
of the United Kingdom as a result of negotiations leading to the Accession
Convention of 1978. The expressions “Civil and Commercial matters”
and “Administrative matters” are not further defined but are, by the
wording of the Article, mutually exclusive. It is submitted by Milan that
any proceedings against it would not be civil or commercial but would
properly fall within the category of administrative matters. It is therefore
necessary to investigate the interpretation of the expression “Civil and
Commercial” and the nature of the proposed claim.
9.That the nature or title of the forum is irrelevant to whether a matter
is civil or commercial depends on its nature and not the court it is in is
emphasised by Mr Jenard who writes
“... It follows from the text of the Convention that civil and commercial
matters are to be classified as such according to their nature, and
irrespective of the character of the court or tribunal which is seized of the
proceedings... this emerges from Article 1....”
10.The approach of the European Court is revealed by several important
cases, the first of which is LTU Lufttransport Unternehmem GmbH & Co.
KG v. Euro Control [1976] ECR page 1541. In deciding an action brought
in Belgium to recover unpaid bills rendered by Euro Control to Luftthanser
the court held (at page 1551)
“By providing that the Convention shall apply “whatever of the nature
of the court or tribunal” Article1 shows that the concept “civil and
commercial matters” cannot be interpreted solely in the light of the
division of jurisdiction between the various types of court existing in
certain States.
The concept in question must therefore be regarded as independent and
must be interpreted by reference, first, to the objectives and scheme of
the Convention and, secondly, to the general principles which stem from
the corpus of the national legal systems.
If the interpretation of the concept is approached in this way, in particular
for the purposes of applying the provisions of Title III of the Convention,
certain types of judicial decision must be regarded as excluded from
the area of application of the convention, either by reason of the legal
relationships between the parties to the action or of the subject matter of
the action.
Although certain judgments given in actions between a public authority
and a person governed by a private law may fall within the area of
application of the convention, this is not so where the public authority act
in the exercise of its powers.”
11.In Netherland State v. Ruffer [1980] case 184/79 the State sought
recovery from a waterman of the costs involved in removing a wreck from
a waterway. The court said
“It is apparent from the case law of the court...that the concept “civil
and commercial matters” used an Article 1 of the Brussels Convention
must be regarded as an independent concept which must be construed
with reference first to the objectives and scheme of the convention, and
secondly to the general principles which stem from the corpus of the
national legal systems.
In the light of those considerations the court has specifically held in that
same case law that whilst certain judgments given in an action between
a public authority and a person governed by private law may come within
the area of application of the convention that is not the case if the public
authority is acting in exercise of its public authority powers.”
There is plainly therefore a distinction to be drawn between civil and
commercial matters falling within the sphere of private law and those
governed by public law.
12.This topic was considered by Professor Schlosser, writing in 1978. At
paragraph 23 of his report he writes
“The distinction between civil and commercial matters on the one hand
and matters of a public law on the other is well recognised in the legal
systems of the original Member states and is, in spite of some important
differences, on the whole arrived at on the basis of similar criteria. Thus
the term “civil law” also includes certain important special subjects which
are not public law, especially, for example, parts of labour law. For this
reason the draftsmen of the original text of the 1968 convention, and the
Jenard report, did not include a definition of civil and commercial matters
and merely stated that the 1968 Convention also applies to decisions of
criminal and administrative courts, provided they are given in a civil or
commercial matter, which occasionally happens.”
He then went on to observe that within the United Kingdom the distinction
in the original EEC States between private law and public law is hardly
known. At paragraph 25 he continued
“In the legal systems of the original member States, the State itself and
corporations exercising in public functions such as local authorities may
become involved in legal transactions in two ways. Having regard to their
special functions and the fact that they are formerly part of public law
they may act outside private law in a “sovereign” capacity. If they do this,
the administrative act... is of a special nature. The State and some other
public corporations may, however, also engage in legal transactions in the
same way as private individuals. They can conclude contracts subject to
private law, for example the transport undertakings... the State and public
corporations can also incur tortuous liability in the same way as private
individuals, for example as a result of a traffic accident in which an official
car is involved. The real difficulty arises from distinguishing between
instances in which the State and its independent organs act in a private
law capacity and those in which they act in a public law capacity....”
14.In his expert report prepared for the court Dr Mads Andenas (Director
of the British Institute of International and Comparative Law) points out
that the objectives of the convention, as set out in the preamble, are
to facilitate the recognition of judgments within the Community. He has
conducted a comparative survey of laws within member States and finds
no general principle with regard to the treatment of actions against a
public authority responsible for roads: in some states it is a matter of
private law; in others, administrative.
15.As to the position under Italian law, the court has the benefit of expert
evidence from Advocato Mauro Rubino-Sammartano, commissioned on
behalf of the Part 20 Claimants and Daniele Discepolo, for Milan. Rubino-
Sammartano says that in Italian law public administration has discretion
in many areas, but that such discretion ceases when the exercise of it
would give rise to a tort. He cites the decision in Serafini v. Comune de
Milano where the court held
“In the matter of road traffic, except as to matters which are governed by
mandatory provisions, the Public Administration enjoys a wide power...
however, such power meets a limit in the duty of neminem laedere and in
the consequential authority of the ordinary Court of Justice to ascertain
the objective existence of dangers and traps on the road....”
He continues that under Italian law in order to qualify a matter involving
a right that the nature of the body against which the claim is made is
generally irrelevant. What is relevant is the ground on which the claim is
based, such as breach of contract or tort. In proceedings before ordinary
courts of justice the public administration enjoys no privileges with regard
to liability or the quantification of damages: it is to be treated in the same
way as any citizen. Paragraph 2043 of the Civil Code reads:
“Any wilful or negligent act, which causes unfair damages to other parties,
obliges the person who committed it to pay the damages.”
He informs the court that in Marangoni v. Municipality of Verona, the
Court of Cassation held:
“In the exercise of its discretion, inherent to the execution of maintenance
by public works, the public administration meets the limit set out by Acts
of Parliament and technical regulations, as well as by the duty of care,
amongst which first is a duty of neminem laedere according to which the
administration is obliged to ensure that the opus publicum... does not
create a hidden danger... to the users. This situation arises, in particular,
when the status of the road is characterised by the concurrent factors
of an objective lack of visibility of the danger and a subjective lack of
foreseeability of that danger.”
In other words, under Italian law, the public authority has no power to act
tortiously: it is liable in tort in the same way as any private citizen.
16.In a very short report Discepolo concludes:
“In the matter in which I have been asked to advise, there is a claim for
damages and in Italy the “causa petendi” is a “private right” (indemnity
for damages) so an Italian court would regard it as a civil not an
administrative matter and jurisdiction even though the Comune di Milano
may have been exercising their public authority powers.”
17.Thus the views of each expert coincide.
18.The next relevant European Court case is Sonntag v. Waidman [1993]
ECR I-1963. The court had to consider whether when the holder of a
public offence (a teacher) who had caused injury to another person by
reason of unlawful breach of his official duty was personally sued for
damages, such action constituted a civil matter with an Article 1. At page
1996 the court held:
“It follows from the judgments in LTU & Ruffer cases... that such an
action falls outside the scope of the Convention only where the author
of damage against whom it is brought must be regarded as a public
authority which acted in the exercise of the public powers.”
Although under domestic German law it was likely that the teacher owed
duties to his pupils in public but not private law, the court ruled that the
duties falling on the teacher were, so far as concerned the standard of
care in relation to the pupils, identical to those owed by all individuals to
those in their care whether or not they were state employees.
19.Having reviewed the three European Court cases thus far cited, Dr
Adenas, when considering the independent convention meaning of “civil
matters” says the question could be: whether the public body would
be considered to have acted in the exercise of its powers in the laws of
member States – a substantive question. He concludes:
“The relevant test is whether the Comune de Milano acted in the exercise
of its public powers. There is some guidance in the three decisions by the
European Court of Justice... it is not, in my view, possible to derive any
clear principles or much assistance from the laws of member States.”
Thus the issues of “independent convention meaning” and the need
to have regard to “the general principles which stem from the corpus
of the national legal systems” appear to be reciprocal. Finally, there is
the decision of the European Court in Gemeente Steenbergen v. Baten,
C271/00 in which judgment was delivered on the 14th November 2002.
An official translation is not yet available, but Counsel for Stubbs/IPC
have produced a transcript in English which I am prepared to accept as
sufficiently accurate for me to give consideration to the decision. The
issue before the court was whether a Netherlands’ local authority could
recover by right of subrogation from Baten social assistance payments it
had made to his divorced wife and child. The question therefore arose as
to whether the action fell within the scope of Article 1. In support of his
contention that the decision in the case would be a civil and commercial
one, Advocate General Tizzamo said:
“...According to the court, in determining whether or not a decision
concerns a civil matter, the nature of the persons who are parties to the
juridical relationship in question, according to the applicable national law,
is to a certain extent irrelevant; what matters is to know whether or not
this relationship is based on acts of public power (Iure Imperii) of the
public authority. Consequently, it will depend on investigating whether
the public authority exercises, in the matter in question, powers which
are different from, and wider than, those which would be exercised in the
same situation by a private person and if, particularly, it has acted “in the
exercise of its [public powers].”
....It is therefore necessary...to identify the legal relationship which is at
the base of the decision, isolating it from the other relationships which are
merely incidental.”
He went on to submit, in the context of the facts:
“It seems... that the commune is not exercising any public power as
against the third party and the legal relationships which exist between
these two persons is no different from the ordinary relationship of
obligation which exists between parties in an equal position, as by
definition is the case with private law relationships.”
20.The court held:
“...Although certain judgments and actions between a public authority
and a person governed by private law may come within the scope of the
Brussels Convention, it is otherwise where the public authority is acting
in the exercise of its public power (LTU, Ruffer)... in order to determine
whether that is so in a case such as that in point... it is necessary to
examine the basis and the detailed rules governing the bringing of that
action.”
Referring to the provisions of the Netherland’s Civil Code the court
continued:
“Thus it is the rules of the civil law which determine the cases in
which the public body may bring an action under a right of recourse,
namely where there is a person under a statutory obligation to pay
maintenance...”
21.The court went on to hold that Article 1:
“... Must be interpreted as meaning that the concept of “civil matters”
encompasses an action under a right of private recourse whereby a
public body seeks from a person governed by the private law recovery
of sums paid by it by way of social assistance to the divorced spouse...,
provided that the basis and the detailed rules related to the bringing of
that action are governed by the rules of the ordinary law in relation to
the maintenance obligations. Where the action under a right of recourse
is founded on provisions by which the legislature have confirmed on the
public body a prerogative of its own, that action cannot be regarded as
being brought in “civil matters”.”
22.On behalf of Milan it is submitted that it is a public body – a local
authority. As such, it exercises public powers included in which are
decisions about road and pavement design and improvements, planning
permission and regulation and provisions with regard to road signs.
All this, it is submitted, is plainly an exercise of public powers in which
Milan takes into consideration much wider factors than would a private
individual carrying out a person building project. It is submitted that
the approach of the court should be to consider what are the Part 20
claimants complaining about. The answer is: the way in which the public
powers has been exercised and therefore it is not a civil or commercial
matter in the light of the decision in Ruffer (supra). Milan submits that
there is a constant thread running through the decisions: Euro Control,
Ruffer, Sonntag, namely that it is necessary to examine the basis and the
rules governing the bringing of the action. Milan submits that the answer
to the point is, however looked at, a claim concerning the exercise by it
of a public power. It is submitted that the test is repeated in Baten and
that the decisions in Sonntag and Baten are no more than examples of
the court applying the correct test and coming up with the correct answer
on the respective facts.
23.On behalf of Stubbs/IPC it is submitted that in the light of the
decisions in Sonntag and Baten it is not sufficient simply to say that
it falls out of the Convention if it involves the exercise of public law
powers. They point out that in Sonntag, although by German law the
teacher exercises public office, that the court found that this did not
mean a teacher always exercises public powers, that in the corpus of
laws of member States a teacher in charge of a school trip would not be
regarded as exercising powers going beyond those existing under the
rules applicable to relations between private individuals. In Baten, the
ratio was that the position of the public body vis-à-vis the person liable to
pay the maintenance was comparable to that of an individual who having
paid another’s debt is surrogated to the right of the original creditor or
is comparable to the situation of a person who, having suffered loss as a
result of an act or omission imputable to a third party, seeks reparation
from that party.
24.In my judgment, it is necessary to consider what in reality is involved
in the apparent exercise of a public law power. A local authority might
decide to build a new civil centre. The taking of that decision would be
the exercise of a public law power. However, the implementing of the
decision by making and enforcing contracts with an architect or builder
would involve no more than the exercise of private law powers. Litigation
on such contracts would plainly be “civil and commercial matters” within
Article 1. I have derived such assistance from the discussion in Briggs
and Rees Civil Jurisdiction and Judgments, Third Edition where at page 44
they write:
“The broad principle of the distinction is therefore this: if the claim made
is one by, or against, a public law body, which only a public law body
would make (or which would lie against only a public law body), the
claim would probably not fall within the regulation [sc. the Convention].
If instead it is a claim which could be brought by any legal person, but
which just happens in this case to be brought by public law body, it will
fall within the scope of the regulation. To the extent that the case law
provides any more detailed guidance, the Court of Justice indicated
in Euro Control and Ruffer, that recourse could be had to the general
principles of member States’ legal systems to see how similar claims
are there categorised; but in practice such guidance may be extremely
limited. More helpful will be to ask the question; is the action brought
by or against a public law body acting as such, or by or against it acting
as any private individual? If the claim is one by or against a private law
person, performing duties which in other States are performed by organs
of government, the claim should nevertheless be seen to be based in
private law and to fall within the scope of the regulation”.
25.If I may be permitted to say so, the approach of the court in Baten
was entirely consistent with the test that the authors propose. It may,
of course, in any given case be difficult to decide where the line is to be
drawn. In my judgment the decisions of the European Court in Sonntag
and Baten provide authority for this approach to the interpretation of
Article 1.
26.The claim of Stubbs/IPC is one in restitution: contribution pursuant to
the Civil Liability (Contribution) Act 1978. Section 1 provides:
“(1)Subject to the following provisions of this section, any person liable
in respect of any damage suffered by another person may recover
contribution from any other person liable in respect of the same damage
(whether jointly with him or otherwise).
...
(6)References in this section to a person’s liability in respect of any
damage are references to any such liability which has been or could be
established in an action brought against him in England and Wales by
or on behalf of the person who suffered damage; but it is immaterial
whether any issue arising any such action was or would be determined (in
accordance with the rules of private international law) by reference to the
law of a country outside England and Wales.”
27.For the purposes of Section 1(1) the liability of the Defendants to
the Claimants on the main claim has been established by the Order for
judgment against them. With regard to Section 1(6) the liability of Milan
could be established by the Claimant whether by application of English
law as the law of the tort (as she pleads) or whether Italian law is to
govern (as Stubbs/IPC maintain): see the evidence above concerning
Italian law. For the sake of completeness, Section 12 of the Private
International Law (Miscellaneous Provisions) Act 1995 provides that as
a general rule referred to the applicable law is the law of the country
in which the events constituting the tort of delict in question occur. It
was held in Petroleo Brasiliero Sa v. Mellitus Shipping Inc (Baltic Flame)
[2001] 2 Lloyds Rep. page 203 at page 213 that the liability to the person
who suffered the damage need not have been incurred in England, nor
be jurisdictionally or procedurally enforceable in England. This whichever
law of the tort is to be applied, Miss Summers could maintain an action
against Milan for damages and under English law Stubbs and IPC have a
statutory right to a claim for contribution.
28.Applying the test: is the action brought against Milan as a public body
acting as such or against it acting as any private individual, the answer
is, in my judgment, that the claim for contribution is a matter of private
law notwithstanding that it would be brought against a public authority
against the background of its exercise of public law functions.
29.It follows that I respectfully disagree with Dr Adanas’s opinion that the
relevant test is whether “Milan acted in the exercise of its public powers.”
In my view this is but the first question. The second is whether the action
brought against it as a public body acting as such or against it as any
private individual.
30.I conclude, therefore, that the proceedings which Stubbs/IPC wish to
bring are “civil and commercial matters”, within the meaning of Article 1.
Does the Part 20 Claim fall within Article 6(2)?
31.Article 2 provides:
“Subject to the provisions of this Convention, persons domiciled in a
Contracting State shall, whatever their nationalities, be sued in the courts
of that State....”
Article 5 provides:
“A person domiciled in a Contracting State may, in another Contracting
State, be sued -
...
(3)In matters relating to tort... in the courts for the place where the
harmful even occurred...”
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.
(2)As a third party in an action or a warranty or a guarantee or in
any other third party proceedings, in the court seized of the original
proceedings, unless these were instituted solely with the object of
removing him from the jurisdiction of the court which would be competent
in his case...”
32.It is submitted on behalf of Milan that Article 6(1) and (2), being
exceptions to the primary rule that the place of domicile is the appropriate
forum, should be construed narrowly and that, as with 6(1) so with 6(2)
there needs to be a “connection”. It is submitted that on close analysis
none exists here.
33.Stubbs/IPC submit that the test of “connection” applicable in the
context of Article 6(1) does not apply to 6(2); alternatively that if such
connection is required it exists in this case. Two decisions of the European
Court are important in respect of Article 6(1). In Kalfelis v. Bankhaus,
Schroder and Others [Case 198/87] the court held that for Article 6(1)
to apply there must exist between various actions brought by the same
plaintiff against different defendants a connection of such a kind that it is
expedient to determine those actions together in order to avoid the risk of
irreconcilable judgments resulting from separate proceedings. The court
said:
“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 into question... the rule laid down in Article 6(1) therefore
applies where the actions brought against the various defendants are
related when the proceedings are instituted, that is to say where it is
expedient to hear and determine them together in order to avoid the risk
of irreconcilable judgments resulting from separate proceedings. It is for
the national court to verify in each individual case whether that condition
is satisfied.”
In Reunion Europeene SA v. Spliethoff’s Bevrachtingskntoor BV [2000] QB
page 690 at page 717 the court held:
“It follows that two claims in one action for compensation, directed
against different defendants and based in one instance on contractual
liability and in the other on liability in tort or delict, cannot be regarded as
connected.”
Thus the position as regards Article 6(1) is clear.
34.In respect of Article 6(2) it was held in Kongress Agentur Hagen GmbH
v. Zeehage BV [C-365/88] that:
“Article 6(2) makes provision for a special jurisdiction, which the plaintiff
may choose because of the existence, in clearly defined situations, of a
particularly close connecting factor between a dispute and the court which
may be called upon to hear it, with a view to the efficacious conduct
of the proceedings... the Convention thus enables the entire dispute
to be heard by a single court. Consequently, the related nature of the
main action and the action on a warranty or guarantee suffices to found
jurisdiction on the part of the court in which the action on a warranty or
guarantee has been brought, irrespective of the basis on which it has
jurisdiction in the original proceedings...”
35.A helpful analysis of Article 6(2) was conducted by Philips J (as he then
was) in Kinnear and Others v. Falconfilms NV and Others [1994] 3 AER at
page 42. At page 45 he said:
“Two issues arise in relation to this Article: (1) does the defendants’ third
party claim constitute...any other third party proceedings” within the
meaning of the Article? (the jurisdiction issue). (2) is this a proper case
for the English court to grant leave to issue third party proceedings? (the
discretion issue).”
To a significant extent the arguments before me have mirrored those
before Philips J. Milan submit that there is no sufficient connection on
the grounds that that Miss Summer’s claim is in tort and the proposed
Part 20 claim in restitution. Thus, it is submitted, as the European Court
has found that there is no risk of irreconcilable judgments if the causes
of action are different for the purposes of Article 6(1) (Hargen, Renuion,
(supra)) so the same reasoning applies to Article 6(2).
36.Stubbs/IPC submit that a distinction must be drawn between a
jurisdictional issue and the conditions governing the admissibility of the
claim. Jurisdiction is to be determined by Article 6(2), admissibility by
the applicable procedural rues of the national court. At page 47 Philips J
referred to the report of Mr Jenard as follows:
“While a third party warranty or guarantee necessarily involved the
intervention of an outsider, it seemed preferable to make separate
provision for guarantors or warrantors and for other third parties. The
simplest definition of a third party proceeding is to be found in Articles
15 and 16 of the Belgium Judicial Code, which provides that: “Third party
proceedings are those in which a third party is joined as a party to the
action. They are intended either to safeguard the interests of the third
party or of one of the parties to the action, or to enable judgment to be
entered against a party, or to allow an order to be made for the purpose
of giving effect to a guarantee or warranty...”
Philips J also referred to Professor Schlosser’s commentary:
“In Article 6(2) the third “third party proceedings” relates to a legal
institution which is common to the legal systems of all the original
Member States, with the exception of Germany. However, a jurisdiction
basis which rests solely on the capacity of the third party to be joined
as such in the proceedings cannot exist by itself. It must necessarily be
supplemented by legal criteria which determine which parties may in
which capacity for what purpose be joined in legal proceedings. Thus
the provisions already existing in, or which may in future be introduced
into, the legal systems of new members States with reference to the
joining of third parties in legal proceedings, remain unaffected by the
1968 Convention.”
Philips J held:
“In my judgment Schlosser’s commentary recognises that where a
domestic procedure permits a third party to be joined in proceedings, this
is likely to be on ground which justify overriding the basic right of the
third party to be sued separately in the country of his domicile and that
those grounds are almost certain to be some form of nexus between the
plaintiff’s claim against the defendant and the defendant’s claim against
the third party. Absent such nexus I would agree that domestic third
party proceedings cannot properly be described as “any other third party
proceedings” in Article 6(2). To adopt the observation... of Mr Advocate
General Lenz in Hagen... “the application of national procedural rules
must not impair the practical effectiveness of the rules of the Convention.”
Having considered the provisions of RSC Order 16 rule 1(1) Philips J
continued:
“In my judgment the nexus between the plaintiff’s claim against the
defendant and the defendant’s claim against a third party require to
satisfy Order 16 rule 1(1) is likely to be sufficient to justify this special
jurisdiction granted by Article 6(2).”
37.I am satisfied that although Article 6(1) and 6(2) constitute exceptions
to the rule of the primary of domicile a distinction is to be drawn between
them. It is plain from the authorities on Article 6(1) that it would not be
involved where the causes of action against co-defendants are different.
On the other hand Article 6(2) it is predicated on the possibility (if not
the likelihood) of different causes of action as between claimant and
defendant and defendant and third party: a creditor’s action against a
surety may be a different cause of action from that against the debtor.
The observations of Philips J on Professor Schlosser’s commentary show
that the Convention recognises that there may be different capacities and
purposes for which third parties can be joined under Article 6(2). Thus the
door is open to the possibility of different causes of action.
38.The purpose of CPR Part 20 is to enable Part 20 claims to be managed
in the most convenient and effective matter. The criteria relevant to the
question of whether a Party 20 claim should be separate from the main
claim are set out in rule 20.9:
“(2)The matters to which the court may have regard include -
(a)the connection between the Part 20 and the claim made by the
Claimant against the Defendant;
(b)whether the Part 20 claim that is seeking is substantially the same
remedy which some other parties claim from him;
(c)whether the Part 20 Claimant wants the court to decide any question
connected with the subject matter or the proceedings -
(i)not only between existing parties but also between existing parties and
a person not already a party; or
(ii)against a existing party not only in a capacity which he is already a
party but also in some further capacity.”
The issues of causation and quantification of damages are relevant both
to the main claim and to the proposed Part 20 proceedings. Stubbs and
IPC are seeking a contribution to the Claimant’s damages on the basis
that Milan is to blame (whether wholly or partly) for the accident. Stubbs
and IPC want the issue to be determined not only between them and
ATM (already before the court) but also against Milan. In satisfying these
criteria a sufficient nexus between the main claim and the third party
proceedings is established subject to the residual discretion of the court
to refuse permission for Milan to be joined. As to discretion, Philips J in
Kinnear observed at page 50:
“In a convention case it would not be proper for the court to apply
domestic rules to decline jurisdiction under Article 6(2) simply because
the third party was domiciled abroad... I am not, however, persuaded
that the court cannot properly when deciding whether or not to exercise
jurisdiction under Article 6(2) in relation to a third party claim, have
regard to the implications on the litigation of adding to the proceedings
the claim which more appropriately be pursued abroad.”
In Hagen (supra) the European Court said:
“...The application of national procedural rules may not impair the
effectiveness of the Convention... a court may not apply conditions of
admissibility laid down by national law which would have the effect of
restricting the application of the rules of jurisdiction laid down in the
Convention.”
In this way, therefore, the discretion of the court is circumscribed.
39.In my judgment once the domestic criteria for the purposes of Article
6(2) are satisfied the court should be slow to exercise its discretion to
refuse permission lest the effectiveness of the Convention be impaired.
The court should stand back and ask itself in a case where jurisdiction is
established: nevertheless should the claim more appropriately be pursued
abroad?
40.Milan submits, in terms, that the discretion is a wide one. It points
out that Italian law is the proper law of the Part 20 claim. It was in Italy
that the accident occurred, the injuries sustained and where Milan was
allegedly negligent. It points to practical difficulties in terms of translation
of documents and the convenience of witnesses. Milan submits that as it
is a public body, comity points towards declining jurisdiction.
41.In my judgment there is no principle of comity that dictates that
permission should be refused. Foreign States and public bodies are parties
to proceeding in English courts and in the courts of other member States.
English courts have long exercised jurisdiction over torts committed
abroad, and have experience in applying foreign laws. Our rules of private
international law are now grounded in statute. On this issue of discretion
I prefer the approach adopted by Stubbs/IPC. They submit that the court
need look no further than the basic tenets of case management. They
emphasise that ATM is before the jurisdiction. Translations of documents
would be necessary in any event. Importantly, in my judgment, they point
out that any proceedings in Italy would be stayed until Mrs Summers’
claim would be finally decided. A period of several years would elapse.
Moreover, they point out that an Italian court would be free to re-open
issues in the main claim of causation and quantification given that
Milan would not have been a party to those proceedings. Finally, they
submit that the cases of ATM and Milan are likely to conflict and that it
is therefore just and convenient that the one tribunal should be able to
decide on the rights and liabilities of the Part 20 Defendant’s inter se as
well as those between Part 20 Claimants and the two defendants.
42.In my judgment the submissions on behalf of Stubbs/IPC, relating as
they do principally to a case management, are powerful. This is a case
here the court’s discretion should be and is exercised in favour of Stubbs/
IPC.
43.Accordingly, the Part 20 proceedings are within Article 6(2) of the
Convention. Milan’s application is therefore dismissed.
The application of Stubbs/IPC under CPR Part 6
44.In view of my decision on Milan’s application a decision on the cross
application is not necessary. However, it has been the subject of detailed
submissions and it is appropriate to make some observations upon it in
the event of my being wrong on the Convention points.
45.CPR Part 6.20 reads:
“In any proceedings to which rule 6.19 does not apply, the claim form
may be served out of the jurisdiction with the permission of the court if -
...
(3A)A claim is a Part 20 claim and the person to be served is a necessary
or proper party to the claim against the Part 20 Claimant...”
46.Stubbs/IPC rely on two grounds: (1) that Milan is a necessary or
proper party to the proceedings which Mrs Summers has brought against
them, and (2) Milan is a necessary or proper party to the Party 20 Claim
against ATM which is already before the court.
47.Milan does not submit that the Part 20 Claimants do not pass these
threshold tests, nor does it argue that there is no real issue which is
reasonable for the court to try (CPR Part 6.21(2)). Milan’s ground of
opposition is in respect of Part 6.21(2A):
“The court will not given permission unless satisfied that England and
Wales is the proper place in which to bring the claim.”
Thus the issue of forum conveniens is raised and must be considered.
48.The leading authority on the point is the decision of the House of Lords
in Spiliada Maritime Corporation v. Cansulex Limited [1978] AC page 460.
Without, I hope, doing violence to the speech of Lord Goff, the issues
requiring consideration by this court are as follows:
(1)Is there some other available forum having competent jurisdiction?
(2)Is that forum clearly the more appropriate or natural forum?
(3)If Italy is the appropriate or natural forum are there other
circumstances by reason of which justice requires the action to be tried in
England?
49.The arguments and counter arguments on this point are essentially
the same as those which each party raise with regard to the discretion
issue under Article 6(2). There is therefore no need for me to repeat
them. It is plain that an Italian court with competent jurisdiction would
be available. However, for the reasons which I have given for exercising
discretion under Article 6(2) in favour of the Part 20 Claimants I would
have held that Italy was not clearly the more appropriate or natural
forum, alternatively, that if it was the circumstances are such that justice
requires the Part 20 action to be tried in England.
50.I would therefore have granted the application of Stubbs/IPC.
Conclusion
51.Milan’s application is therefore dismissed. I would wish to hear
submissions from Counsel as to the appropriate consequential orders.
There is the issue of costs of these proceedings (and those thrown away
in the proceedings before Holland J) to be considered.
52.Finally, I wish to express my appreciation to Counsel for well prepared,
cogent and helpful submissions. (...)"