Posts Tagged abuse of process
I reported earlier on the Aldi abuse of process principle: a party who intends to bring a subsequent action against existing parties or their privies must raise the issue with the court, which on case-management grounds may hold that all claims must be brought simultaneously.
In 2016 BVIHC 0059 (COM) Serena Chi Yang Hsueh et al v Equity Trustee ltd. et al Chivers J has now held that the principle applies in the British Virgin Islands. Harneys have the report here, and a big thank you to Kimberley Crabbe-Adams and Ian Mann for providing me with copy. Telling, at 94 is Chivers J’s conclusion (following review of authority) that while the specific Aldi requirement may not as such have been promulgated in BVI, there can be no doubt of the obligation of a litigant to put all their cards on the table, before the other party and the court, at an early stage. The CPR demand so, specifically as their overall objective (at 90, referring to CPR 1.1(1) is to deal with cases ‘justly’.
I have pondered before whether there ought not to be an Aldi rule in EU conflicts law, however one can see the difficulty particularly as in the EU context an Aldi principle might favour the actor sequitur forum rei rule to the detriment of special jurisdictional rules: not an outcome supported by the current rules.
Don’t leave the store without asking. Joinders, and the Aldi principle applied in Otkritie. On the shopping list for the EU?
Postscript 21 November 2017: For an application in Hong Kong see Far Wealth Ltd v Lo Ki Mou, reported here: proceedings dismissed as an abuse of process because the plaintiffs could have protected their position by way of a counterclaim in prior proceedings commenced against them by the defendants.
A posting out off the box here, so bear with me. Neither Brussels I nor the Recast include many requirements with respect to (now) Article 8(1)’s rule on joinders. A case against a defendant, not domiciled in the court’s jurisdiction, may be joined with that against a defendant who is so domiciled, if the cases are ‘so closely connected that it is expedient to hear and determine them together in order to avoid the risk of irreconcilable judgments’. There is of course CJEU case-law on what ‘so closely connected’ means however that is outside the remit of current posting.
As I reported recently, the CJEU has introduced a limited window of abuse of process viz Article 8(1), in CDC. The Court’s overall approach to Article 8(1) is not to take into account the subjective intentions of plaintiff, who often identify a suitable anchor defendant even if is not the intended target of their action. The Court does make exception for one particular occasion, namely if it is found that, at the time the proceedings were instituted, the applicant and that defendant had colluded to artificially fulfil, or prolong the fulfilment of, (now) Article 8’s applicability.
What if at the time the proceedings were instituted, applicant artificially ignores the fulfilment of, (now) Article 8’s applicability?
The Aldi rule of the courts of England and Wales, and its recent application in Otkritie, made me ponder whether there is merit in suggesting that the CJEU should interpret Article 8(1) to include an obligation, rather than a mere possibility, to join closely connected cases. I haven’t gotten much further than pondering, for there are undoubtedly important complications.
First, a quick look at the Aldi rule, in which the Court of Appeal considered application of the Johnson v Gore Wood principles on abuse of process of the (then) House of Lords, to an attempt to strike out a claim for abuse of process on the basis that the claim could and should have been brought in previous litigation. Aldi concerned complex commercial litigation, as does Otkritie. The result of Aldi is that plaintiffs need to consult with the court in case management, to ensure that related claims are brough in one go. Evidently, the courts need to walk a fine rope for the starting point must be that plaintiffs have wide discretion in deciding where and when to bring a claim: that would seem inherent in Article 6 ECHR’s right to a fair trial.
In Otkritie [the case nota bene does not involve the Brussels Regulation], Knowles J strikes the right balance in holding that the Aldi requirement of discussing with the court had been breached (and would have cost implications for Otkritie in current proceedings) but that otherwise this breach did not amount to abuse of process.
Now, transporting this to the EU level: to what degree could /should Article 8 include a duty to join closely related proceedings? Should such duty be imposed only on plaintiff or also on the court, proprio motu? A crazy thought perhaps for the time being, but certainly worthwhile pondering for future conflicts entertainment.
An end to libel tourism in the UK? The High Court in Subotic and Karpov. Abuse principles sink jurisdiction.
Two interesting cases in the High Court on libel tourism, Subotic and Karpov (both held 14 October 2013). The relevance to English libel law is set out by Robert Renfree and by Paul Dacam. Here I just wanted to flag the jurisdictional issues under the Brussels regime.
In Subotic, a Serbian national living in Switzerland, Dingemans J accepted English jurisdiction in principle although it is not entirely clear on what basis. Domicile of the defendant at the time of the initiation of the claim was alleged by claimant to have been England. However defendant disputed such domicile, referring to inferred addresses having been a left-over of earlier study in the UK (but adding complaints about his wife and children’s address in London having been found, whence the dispute on domicile was not entirely clear). Counsel for the defendant also referred to his client having shied away, for costs reasons, from English proceedings after earlier acceptance to entertain the claim – however this potential voluntary appearance under Article 24 of the Regulation was not further reviewed. It is most likely that acceptance of jurisdiction was made on the basis of Article 5(3) of the Regulation however as readers will be aware, that does limit jurisdiction to damage in the UK only (the alleged acts leading to libel not having taken place in the UK, only some of the reputational damage). To add to the fog, parallel proceedings are alleged by plaintiff to be underway in Switzerland although their course is unclear. Finally, defendant now is domiciled in Croatia, EU Member State since 1 July 2013. As Dingemans suggested, this would certainly not stand in the way of new proceedings there (although it could of course lead to lis alibi pendens considerations, depending on what would be asked of the Croatian court).
Eventually, Dingemans held that continuation of the proceedings would amount to abuse of process, ‘The evidence shows that there was no substantial publication in England and Wales, and that there was no effect on the reputation of Mr Subotic in England and Wales.‘ There was, in other words, insufficient connection to England and Wales.
This is arguably not a refusal to exercise jurisdiction otherwise held under the Brussels I Regulation (per Owusu, that would be impossible), rather, an application of procedural rules under lex fori, or indeed a forward application of the lex causae (definitely libel under common law, as defamation is exempt from the Rome II Regulation). However upon first reflection, the abuse of process route may in circumstances such as these be seen as an application of the forum non conveniens doctrine. Any thoughts of common lawyers are certainly invited!
In Karpov, the claimant was a former Russian police officer who had brought proceedings against a British based hedge fund owner and associated companies. Simon J, too, held abuse of process in this case, holding inter alia that ‘claimant had no connection with, and had no reputation to protect within, the jurisdiction; and therefore cannot establish a real and substantial tort within the jurisdiction.’ In this case, though, none of the defendants was domiciled in the UK (Hermitage Capital Management (UK) Limited would seem to be domiciled in Guernsey, which is not part of the UK and not subject to the jurisdiction Regulation). Jurisdiction in Karpov therefore was entirely determined by English law.