Premier Cruises v DLA Piper Russia and UK. Textbook ‘arbitration’ exception under Brussels Ia.

Premier Cruises Ltd v DLA Piper Rus Ltd & Anor [2021] EWHC 151 (Comm) is a textbook case for the relationship between arbitration and the Brussels Ia regulation, as well as relevance of lex arbitri on what is within the scope of an arbitration agreement.

Claimant is Premier Cruises Limited (“PCL”), a company originally domiciled in the British Virgin Islands and now domiciled in the Seychelles, which owns or operates two vessels. Defendants are entities within the DLA Piper Group of legal practices. The First Defendant is DLA Piper Rus Limited (“DLA Russia”), an English company with operations in Russia. The Second Defendant is DLA Piper UK LLP (“DLA UK”), an English LLP.  On 29 January 2020 (within the scope of Brussels Ia, therefore, at least as against DLA UK), PCL commenced proceedings against DLA in the Commercial Court claiming damages in contract and/or in tort for professional negligence.

DLA Russia argues the claim is within the scope of its arbitration agreement included in the engagement letter (International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation). DLA UK accepted it was not included in that agreement and applied for a case-management stay.

PCL argue its action against DLA Russia is in respect of advice allegedly given and work allegedly carried out by DLA Russia prior to 26 May 2015 when the Engagement Letter came into force.

At 52, Edward J identified Russian law as both lex contractus and lex arbitri, and held at 138 after hearing the Russian law experts, that upon contractual construction, PCL’s claim was not included in the clause for it was not meant to apply retroactively.

At 147 ff he agreed with PCL that a case-management stay for the claim against DLA UK is not possible given, with reference to Recital 12 BIa, that the arbitration exception is not engaged: ‘The claim made against DLA UK in this action is not one in respect of which PCL and DLA UK have entered into an arbitration agreement [161]; Arbitration is not the principal focus of the English proceedings against DLA UK; the essential subject matter of the claim made against DLA UK does not concern arbitration; and the relief sought in the proceedings is not ancillary to or an integral part of any arbitration process [163] (reference is made to The Prestige].

The claim being within BIa, Owusu rules out a case management stay. The judge should have outright rejected the additional suggestion ([158 juncto [164]) of a temporary stay being within the Owusu confines.

Geert.

EU Private International Law, 3rd ed. 2021, Heading 2.2.3.4, para 2.110 ff.

 

Galapagos v Kebekus. Freeport’s unfinished anchor mechanism analysis continues to spook the intensity of merits review at the jurisdictional stage.

Galapagos Bidco SARL v Kebekus & ors [2021] EWHC 68 (Ch) is yet again a fairly extensive first instance judgment merely on the issue of jurisdiction, entertaining Article 8(1) Brussel Ia’s anchor defendant mechanism as well as Article 25 choice of court.

On A8(1), focus of the discussion was the extent of a merits review under A8(1), which I also discuss  in Sabbagh v Khoury and Senior Taxi v Agusta Westland (both referred to here by Zacaroli J at 44 ff.; as was nb PIS v Al Rajaan). The issue was raised in CJEU C-98/06 Freeport but not answered. The judge here uses the notion of ‘sustainable claim’ to ensure absence of abuse of the anchor mechanism, concluding at 132 after fairly serious if arguably not excessive engagement with the merits, that the conditions of A8(1) are fulfilled.

Article 25 choice of court is discussed obiter at 138 ff., leading to some discussion on the timing of the binding character of the clause upon various parties (and a minor side-issue re Brexit).

A case-management stay was also applied for, with the judge justifiably adopting the strict approach at 160 that such a stay must not be used to circumvent the inapplicability of an Article 34 BIa challenge (the A34 route was dropped; in the light of A25 jurisdiction being established, it would be unavailable at any rate): case-management stay in such circumstances is in essence an application for forum non conveniens which is not permitted under BIa.

Geert.

EU Private International Law, 3rd ed. 2021, Heading 2.2.13.1 (in particular 2.496); Heading 2.2.15.3.2.