X v PayPal. Questionable Dutch compulsory settlement jurisdiction reignites discussion similar to English scheme of arrangement tourism. Also raises the question whether compulsory settlements are ‘contracts’ under Rome I.

The Dutch first instance judgment in Groningen  earlier this month, in X v PayPal (Europe) S.a.r.l. & Cie S.C.A., sees claimant debtor essentially seeking a compulsory settlement – CS. PayPal (established in Luxembourg) is the only debtor refusing the settlement proposed by claimant’s bank.

The CS is not listed in Annex I to the Insolvency Regulation 2015/848 (always check for the consolidated version, for the Annex is frequently updated by the Member States’ communication of proceedings to be included). This is where the discussion of scope of application could and should end.

Instead, the judge tests the CS against A1(1)’s abstract criteria. She decides there is neither divestment of assets, nor a temporary stay of individual enforcement proceedings.

This then raises the applicability of Brussels Ia. Seeing as the judge finds the action does not meet with the CJEU F-Tex criteria (Brussels Ia’s insolvency exception only applies to actions which derive directly from insolvency proceedings and are closely connected with them), she holds that Brussels Ia’s ‘insolvency’ exception is not triggered and that BIa applies.

The judge then cuts the corner which English courts in schemes of arrangement have often cut, namely to consider the willing debtors, domiciled in The Netherlands, as ‘defendants’ per Brussels Ia, hereby triggering Article 8(1) BIa’s anchor defendant mechanism. The judge justifies this by stating that the other creditors are interested parties and that it is in the interest of the sound administration of justice that the CS be discussed viz the interested parties as a whole. That may well be so, however in my view that is insufficient reason for A8(1) to be triggered. A8(1) requires ‘defendants’ in the forum state, not just ‘interested parties’. The suggestion that a co-ordinated approach with an eye for all interested parties, justifies jurisdiction, puts A8(1)‘s expediency cart before the A4 ‘defendant’-horse.

The judge then also cuts corners (at least in her stated reasons) on the applicable law issue, cataloguing this firmly in Rome I. She argues that even if the CS is a forced arrangement, replacing a proposed contract which party refused to enter into, it is still a contractual arrangement. That is far from convincing.

Equally not obvious is as the judge holds, that  per A4(2) Rome I, the party required to effect the ‘characteristic performance’ of a compulsory settlement, is the claimant-debtor of the underlying debt, leading to Dutch law being the lex causae.

The judgment at the very least highlights the continuing elephant in the restructuring tourism room, namely the exact nature of these proceedings under Brussels Ia, EIR and Rome I.

Geert.

Quite the song and dance. Dutch TikTok class action passes jurisdictional hurdle at first instance, cutting many a((n) appealable) corner in the process.

I reported earlier on the ongoing collective claim against TikTok here. Thank you Xandra Kramer and Eduardo Silva de Freitas for signalling and discussing the first instance jurisdictional finding. I note already that the Court [5.28] has refused interim permission to appeal on the jurisdictional finding (as in i.a. the applicable law issue in Airbus). [5.22] it also refused a preliminary reference o the CJEU even though my concise discussion below already shows that more is at play here than the court has made out. TikTok will now first have to argue the case on the merits to then (presumably) appealing both substance and jurisdictional finding.

As I flagged earlier and as Xandra and Eduardo discuss, the issue here is firstly the relationship between GDPR and Brussels Ia at the jurisdictional level: I discuss that in this paper. Against TikTok Ireland, jurisdiction is established on the basis of A80 GDPR, with no further discussion of A79 (even if A80 partially refers to A79 for the action it establishes).

In my view the court quite carelessly muddles the various concepts used in A79-80, all too easily dismisses ia CJEU Schrems, does not clearly distinguish between assignment, subrogation, mandate etc., and certainly does not correctly delineates the authority which the collective organisations might have under the GDPR: for it is not at all clear that this authority, beyond injunctive relief,  includes a (collective) claim for damages.

[5.13] the court already announces that it may not in fact have jurisdiction for all individuals who are no longer habitually resident in The Netherlands, a concession which in my view in fact goes towards undermining its own reasoning.

[5.14] ff the court then reviews A4 and 7(2) BIa, as a supplementary jurisdictional ground for the GDPR related claims and as a stand-alone ground for the non-GDPR related claims. The court’s decision to apply CJEU Wikingerhof as leading to forum delicti and not forum contractus is in my view optimistic, and surely if A7(2) is at play then the CJEU’s authority ia in Schrems is, too. Yet the court [5.17] quite happily assimilates the harmed individuals’ COMI etc. with the collective organisation.

[5.19-20] the court summarily accepts jurisdiction against the other (non-EU) TikTok entities on the basis of Dutch residual rules for related cases.

Jurisdictional issues will most definitely return upon eventual appeal.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.8.2.5.

 

 

The Dutch MH17 judgment and the conflict of laws. On civil claims anchored to criminal suits, and the application of Article 4(3) Rome II’s escape clause.

Their relevance is of course insignificant in light of the dreadful events that  triggered the judgments, however I thought I would flag the private international law elements in this week’s four Dutch judgments following the criminal prosecution of the suspects (now culprits) in the downing of MH17.

The judgment against Mr Pulatov was the  only one to respond to defence arguments actually made: he was the only one to have been represented (the other judgments were held in absentia). The judges extrapolate his arguments to the  other defendants to ensure some kind of proper representation, however they also explore further elements not raised by Mr Pulatov in the other judgments. This includes precisely the private international law elements for, it seems, no private claim was attached to the prosecution of Mr Pulatov while it was against the other defendants.

In this post I take the judgment against Mr Dubinskiy as the relevant text (structure and content of the other 2 judgments are essentially the same).

[12.4.1] discusses the possibility of judging the civil leg of a criminal suit. That the crimes could be prosecuted in The Netherlands is established on the basis of international criminal law of course, which is not the area of this blog. Jurisdiction for the civil leg is justified by reference to this being accepted international practice. Support (not: legal basis per se) is found by the court in Article 7(3) Brussels Ia:

A person domiciled in a Member State may be sued in another Member State:

as regards a civil claim for damages or restitution which is based on an act giving rise to criminal proceedings, in the court seised of those proceedings, to the extent that that court has jurisdiction under its own law to entertain civil proceedings;

and in the similar regime under the Lugano Convention. The court rejects a potential (this judgment as noted was issued in absentia) lis pendens argument vis-a-vis proceedings  in the United States. The court remarks that these judgments had already been issued before the Dutch criminal prosecution was initiated; that therefore there are no concurrent proceedings unto which a lis pendens argument could be raised; and that the US judgments reached the same conclusion.

Res judicata of the US judgments is dismissed as an element which would impact the Dutch judgments at this stage. The court does point out that res judicata may return at the enforcement stage of the damages part of the judgments, in that the victims will not be entitled to double compensation. Note that the US judgments included punitive damages which as readers will know is also a complicating factor for enforcement in the EU.

At 12.14.2 the court then turns to applicable law, for which it of course applies Rome II. With reference to CJEU C-350/14 Lazar, it dismisses the ‘extraordinary suffering’ of the relatives of the victims as ‘indirect damage’ under Rome II, instead exclusively taking the direct damage (the passing away) of the victims on Ukrainian territory as determinant for locus damni.

Dutch law is held not to be ‘manifestly more closely connected’ per A4(3) Rome II, despite the majority of the victims being Dutch. The court in this respect refers firstly to the link with Ukraine not being accidental (such as might be the case in ‘ordinary’ mass claims) but rather directly linked to the hostilities in Ukraine), moreover to the need to guard what it calls the ‘internal harmony’ of the judgment seeing as there are also non-Dutch relatives involved. This I find a touch unconvincing, particularly seeing as the court itself in the same para, with reference to Jan von Hein in Callies’ 2nd ed. of the Rome Regulations commentary, refers to the need to consider A4(3)’s escape clause individually, not collectively.

Geert.

Links to all 4 judgments:

https://deeplink.rechtspraak.nl/uitspraak?id=ECLI:NL:RBDHA:2022:12219

https://deeplink.rechtspraak.nl/uitspraak?id=ECLI:NL:RBDHA:2022:12218

https://deeplink.rechtspraak.nl/uitspraak?id=ECLI:NL:RBDHA:2022:12217

https://deeplink.rechtspraak.nl/uitspraak?id=ECLI:NL:RBDHA:2022:12216

Grand Production v GO4YU. Szpunar AG (not, due to suggested inadmissibility) on copyright, VPNs and forum delicti for platform streaming.

Szpunar AG opined a few weeks back in C-423/21 Grand Production v GO4YU  ea. The case involves a variety of issues related to streaming and VPNs, many of which concern telecoms law yet one is of interest to the blog: namely the question whether

in the event of an allegation of infringement of copyright and related rights guaranteed by the Member State of the court seised, that court has jurisdiction only to rule on the damage caused in the territory of the Member State to which it belongs – because the territoriality principle precludes domestic courts from having jurisdiction to determine and examine the facts in relation to foreign acts of infringement – or can or must that court also rule on offences committed outside that territory (worldwide), as alleged by the author whose rights were allegedly infringed?

It transpires from the Opinion however that the case in the national court does not involve one for damages, yet rather one for a temporary injunction prohibiting distribution. To the degree this is aimed at the Serbian defendants at issue, these are domiciled outside the EU and hence not subject for actions in tort, to Brussels Ia. Against the Austrian defendants, the case is subject to full jurisdiction under A4 forum re, hence not triggering the full or partial jurisdictional issues of the relevant CJEU case-law (Bolagsupplysningen etc.).

The AG suggests inadmissibility of the Brussels Ia question.

Geert.

Otsuka v GW Pharma. When does a tussle about intellectual property rights engage the Moçambique rule?

I tweeted the case on 4 May….slowly I am getting trough the backlog. In Otsuka v GW Pharma [2022] EWHC 1012 (Pat) Karet DJ upheld jurisdiction to hear a dispute about a patent licence in circumstances where the licensee has indicated it will challenge the validity of licensed patents granted outside the UK.

On 7 January 2022 GW commenced proceedings against Otsuka in a state court in New York. There is a significant overlap between the matters raised in the New York claim and the E&W claim (as GW have indicated they will defend it). GW seek a declaration that under the Agreement between the parties none of the relevant patents Covers Epidyolex, including because the patents are invalid. Epidyolex is a drug for the treatment of seizures associated with various conditions or epileptic syndromes. The active ingredient in Epidyolex is cannabidiol (“CBD”).

[47] ff the judge considers the Moçambique rule which means that an English court has no jurisdiction to adjudicate a claim of title to foreign land. In Lucasfilm v Ainsworth the UKSC with some reference to the CJEU’s application of Brussels Ia’s Article 24, held that there is no jurisdiction in proceedings for infringement of rights in foreign land where the proceedings are “principally concerned with a question of the title, or the right to possession, of that property” (including intellectual property). [51] Reference is also made to Chugai Pharmaceutical Co Ltd v UCB Pharma SA and to Unwired Planet International Ltd v Huawei Technologies (UK) Co Ltd.

The judge [73] holds GW’s intended challenge to a foreign patent in this case is not direct in the sense suggested in Chugai and the rule in Moçambique is not engaged. Claim formulation in the US proceedings features as a strong argument in that conclusion. [81] ff a forum non challenge is rejected.

Geert.

EU private international law, 3rd ed. 2021, 2.196 ff.

Fong Chak Kwan v Ascentic. The Hong Kong Court of Final Appeal aligns the damage jurisdictional gateway with the UKSC’s Brownlie approach.

This post is one for the comparative binder. Fong Chak Kwan v Ascentic Limited and Others [2022] HKCFA 12 (many thanks to Poomintr Sooksripaisarnkit for alerting me to the judgment) discusses a variety of issues, the one of interest to the blog is the tort gateway for a tort allegedly committed outside of Hong Kong. The ruling on that issue was delivered by Lord Collins, a former UKSC judge who continues to sit in the Hong Kong judicial system (unlike others who have withdrawn from the Hong Kong courts in light of the region’s rule of law issues).

[67] Direct damage was sustained on the Mainland, with indirect damage only in Hong Kong.

The First Instance judge [68] ‘in line with the majority judgments of Lady Hale and Lord Wilson in [UKSC Brownlie] .., and being unpersuaded by the minority view of Lord Sumption, decided that (a) the expression “damage” in Gateway F was not limited to damage which completed the cause of action; (b) the expression was not limited to direct damage as opposed to indirect/consequential damage; (c) where damage was felt in more than one jurisdiction, indirect/consequential damage qualified under Gateway F if it was of some significance; (d) the expression was to be given its ordinary and natural meaning, which embraced indirect/consequential damage; and (e) the consequences of a wide interpretation were sufficiently addressed by the discretion as to forum conveniens.’ 

The Court of Appeal [69] ‘like the judge, held that the reasoning of the majority in Brownlie v Four Seasons Holdings Inc was to be preferred to that of the minority. Damage included all of the heads of damage which might be suffered as a result of tortious conduct, including all the detriment, physical, financial and social which the plaintiff suffered as a result. The natural and ordinary meaning of Gateway F was clear, and there was no basis for drawing a distinction between direct and indirect damage. Nor was there any basis for applying the European jurisprudence on the Brussels Convention and Brussels I Regulations. Finally, the expression “the damage” in Gateway F did not mean that all the damage, or the damage which completed the cause of action, had to be sustained in Hong Kong.’

[74] ff Collins NPJ provides a historic and geographical comparative (Commonwealth) tour d’horizon, confirming the lower courts’ view.

[107]-[108] ‘(I)n the light of the legislative purpose, the natural and ordinary meaning of the word “damage” is just that, and the rule does not distinguish between the damage which completes a cause of action and that which does not, nor does it distinguish between direct or indirect damage, or between physical or financial damage. The question is whether there is a legislative purpose, or a public policy, or an absurd or undesirable result, which justifies a narrower construction, to encompass only direct damage as opposed to indirect damage.’: the judge finds there is no such purpose, policy or result.’

[109] he discusses 3 flows in the reasoning of the alternative reading, which are worth a read. [121] the same safety valve is emphasised as the UKSC did in the majority view in Brownlie: where the exercise of the locus damni gateway leads to unwarranted results, forum non conveniens can come to the rescue.

Geert.

On the Beach v Ryanair. A clairvoyance stretch in assessing an Article 30 ‘related actions’ stay.

Another overdue post following up on earlier Twitter flag. In On the Beach Ltd v Ryanair UK Ltd & Anor [2022] EWHC 861 (Ch) is a competition law ‘stand-alone’ damages suit. OTB  is an online travel agent. It claims against Ryanair on the basis of abuse of dominant position. Ryanair have claimed against ia OTB in Ireland, on the basis among others of infringement of intellectual property rights. (Ryanair prefer to sell directly to consumers and  do not generally co-operate with online or other travel agents). OTB suggest the Irish claim is effectively warehoused and that an Irish court will soon hold the claim be dismissed for want of ‘prosecution’.

Nugee LJ considered in particular whether in assessing the relatedness of proceedings, the judge can indeed may have to take into account what is likely to be pleaded by way of defence in both actions (here: OTB is likely to plead competition law arguments should the case continue in Ireland). He held [52] he can:

the better view is that where an application for a stay is made at a stage when the defence to an action has not yet been pleaded, the Court can have regard to the substance of a defence that it can confidently predict is likely to be pleaded.

However [53] ff on the facts he then sided with OTB which argued

that the Court can hardly proceed on the basis that OTB is likely to plead any particular matter by way of defence in the Irish OTB proceedings as if its motion to dismiss the action for want of prosecution succeeds, there never will be a defence. At that point any chance of the two actions being related will disappear.

This is where the reasoning becomes contradictory. The judge [54] concedes that he ‘was not asked by either party to form any view of the likely outcome of OTB’s motion to dismiss, and I would in any event be very reluctant to do so as this is self-evidently a matter for the Irish court’ . However [55] he says that

if one looks at the Irish proceedings as they stand, with no competition issues yet raised, there does not seem to me much overlap between the claims there made and Ryanair’s prospective defence in England which will be focused very largely on competition issues.

This I believe amounts to a form of judicial and litigation clairvoyance which goes too far, even in the wide remit which Article 30 gives to the judge assessing relatedness and the appropriateness of an Article 30 stay.

[57] ff Nuggee LJ holds obiter that had the cases been related, he would have exercised his discretion not to stay.

Geert.

EU Private International Law, 3rd ed. 2021, 2.521 ff.

The Belgian DPA yet again on processing of activities and Article 3(1) v 3(2) GDPR. Google appeals a prime example of circular reasoning.

The Belgian Data Protection Controller (DPA)’s decision of March 2022 (thank you Peter Craddock for alerting me to it at the time) has been travelling with me since it was issued mid March 2022: a late posting, I realise. There is however follow-up because Google have appealed.

The case concerns a classic ‘right to be forgotten’ aka delisting request, which Google refused, made by a practising solicitor with a criminal conviction and disciplinary measures taken against him. Google was rebuked, but not fined, for not dealing with the request promptly. However in substance the DPA agreed with Google’s refusal to delist, citing the link of the convictions to the applicant’s current profession, the recent nature of the conviction, and the severity of the facts.

This post however wants to signal the issue for which Google have appealed: the territorial reach of the GDPR under Article 3(1) v 3(2) GDPR,  as also explained in the European Data Protection Board (EDPA) December 2019 guidelines on the territorial scope of the GDPR (and something which the Belgian Court of Appeal has grappled with before, albeit not in the 3(1) v 3(2) setting).

Article 3(1) of the GDPR applies to “the processing of personal data in the context of the activities of an establishment of a controller or processor in the Union, regardless of whether processing takes place in the Union or not“. Article 3(2) applies the GDPR to “the processing of personal data of data subjects who are in the Union by a controller or processor not established in the Union, where the processing activities are related to (a) the offering of goods or services, irrespective of whether a payment of the data subject is required, to such data subjects in the Union, or (b) the monitoring of their behaviour as far as their behaviour takes place within the Union“.

Google Ireland was fast out off the picture by consent among the parties and the DPA [39-40]: it had no role at all in any of the processing. Google LL.C. admitted [44] that Article 3(1) applies to it, while Google Belgium [53] posits that as a mere internal consultancy /lobbying outfit for the Google group, it, too, has no role in the processing of the data.

Citing earlier decisions and CJEU Google Spain, the DPA nevertheless takes a broad view of ‘data processing’, arguing [64] that Google Spain identifies an ‘inextricable link’ between the various units of a group as sufficient to trigger DPA jurisdiction, even if one of these units has no role in the data processing.  While this reasoning ([68] and [71] in particular) suggests the wide notion of inextricable link triggers Article 3(1), in subsequent paras ([69] in particular) suggest the opposite causality: suggesting that because Article 3(1) applies, the activities are inextricably linked. Clearly, as Peter Craddock had pointed out before (I read it at the time but cannot find the source anymore I fear) that is a case of circular reasoning.

For Google, application of the GDPR to the US based entity as opposed to the EU based ones clearly is of significant difference. Its appeal with the Court of Appeal will be heard in the autumn.

Geert.

EU private international law, 3rd. ed. 2021, 2.256 ff.

 

The CJEU in Allianz. Among others linguistic arguments lead to the Court confirming Brussels Ia identifies territorial jurisdiction in direct action against an insurer.

In Case C-652/20 HW, ZF, MZ v Allianz Elementar Versicherungs AG, the CJEU held (no English version of the judgment is as yet available) end of June that A11(1)(b) Brussels Ia, determines jurisdiction not just of ‘the’ courts in a Member State (leaving territorial jurisdiction to be determined by national civil procedure rules) but rather of a specific court within that Member State. The judgment is a bit longer than might have been expected: that is because the referring judge did not qualify one or two elements which, particularly in an insurance context, can be quite convoluted. (Such as the nature and deliniation of ‘beneficiaries’, ‘insureds’, ‘victims’).

In accordance with the Article, ‘An insurer domiciled in a Member State may be sued: …(b) in another Member State, in the case of actions brought by the policyholder, the insured or a beneficiary, in the courts for the place where the claimant is domiciled’.

[35] The Court observes that in the Romanian (the language of the case) as well as the English and Finnish version of Brussels Ia use the plural ‘courts’ while in the other language versions, the singular is used. (Regular readers of the blog may be familiar with my earlier work on languages and interpretation). Coupled with the indications of territorial jurisdiction in the relevant section of the Report Jenard, and with the similar language in A7(1) and (2) and relevant case-law there (ex multi: Kareda, Volvo), the CJEU concludes that where A11(1)(b) and all its conditions apply, the Article identifies both national and territorial jurisdiction indeed.

Geert.

 

Municipio de Mariana v BHP. Questions on Brussels Ia’s lis pendens rules viz third states remain. Yet overall approach to environment, human rights suits against corporations in their domicile, to be applauded.

Update 17 01 2023 my article on Articles 33-34 has now been published: Lis Pendens and third states: the origin, DNA and early case-law on Articles 33 and 34 of the Brussels Ia Regulation and its “forum non conveniens-light” rules, The link in the title should give free access to the first 50 takers, and I assume link to the review for those that come after.

Municipio De Mariana & Ors v BHP Group (UK) Ltd & Anor [2022] EWCA Civ 951 (background to the case here) is the appeal against the stay (and partial strike-out), on forum non conveniens, A33-34 Brussels Ia and case-management grounds ordered by Justice Turner. The Court of Appeal has overturned all three reasons for a stay. Bar appeal with the Supreme Court (which the defendants are likely to seek) the claimants may now bring their claim in the courts of England and Wales.

For the benefit of full disclosure I should add I am instructed for claimants in the case; this post however does not speak for claimants or co-counsel in the case and is merely my academic view on the judgment.

The judgment runs to 107 pages (not excessive given the issues and facts covered). There is little point in me rehashing it all (again, reference to my previous post may be useful). 40 pages are spent describing the applicable law in Brasil and the various proceedings underway there. This is of particular importance seeing as the crux of all three defences advanced is that the proceedings are already underway in Brasil and should not be duplicated by an English procedure.

In the main:

Abuse is dealt with [170] ff, with the key points for reversal listed [179] and the CA’s own analysis detailed thereafter, summarising in [234] ff.

Of particular note here is the rebuke of Justice Turner’s finding of ‘unmanageability’ of proceedings (which the CA as such does not believe will be the case) having dominated his subsequent findings on other elements of abuse, and the use of forum non conveniens criteria for the assessment of abuse.

[182] Consideration should have been made of the question of the availability of full redress in Brazil. To those following business and human rights litigation, this will be a welcome finding. [186] Support for manageability of proceedings not having a place in the abuse assessment (other than [187] if the claimant were to have vexatiously made the proceedings unmanageable himself), was found in Mastercard v Merricks [2020] UKSC 5.

[190] discussion of what Turner J at the abuse level,  saw as complications arising out of the existence of parallel proceedings in Brazil, already indicate the direction the Court took on the forum non and A34 issue: the many differences between the English and the Brazilian proceedings.

The Article 34 Brussels Ia application is discussed [237] ff and is of particular relevance to readers of the blog.

Firstly [256] the Court of Appeal settles for now the Privatbank /Euroeco discussion on ‘expediency’ (see also ia SCOR v Barclays) in favour of the former: What is required to fulfil A34(1)(a)’s condition is that it must be desirable for the two actions to be heard and determined together in order to avoid the risk of irreconcilable judgments, irrespective of whether that is a practical possibility. (Claimants have reserved the right to contest this should the matter go before the Supreme Court).

Further [257] the test of relatedness for the purposes of A34 is held by the CA to be a broad test: [243] per Tesauro AG in C-406/92 The Tatry, whenever the judge seized of the stay request considers that the reasoning adopted by the court hearing the earlier proceedings may concern issues likely to be relevant to its own decision, the cases can be said to be related. This is opposed to the narrow approach in the House of Lords Sarrio SA v Kuwait Investment Office [1991] AC 32: there the HoL held that for there to be a risk of irreconcilable judgments the inquiry is limited to “primary” issues which are those necessary to establish the cause of action, and does not include issues which the court might or might not decide and which would not be essential to its conclusion.

On the condition ‘that the court of the third State will give a judgment capable of recognition‘, at the hearing the question was asked whether a twofold condition exists, namely (i) that a judgment was expected as a matter of fact and (ii) that the expected judgment was one which was capable of recognition and, where applicable, enforcement. The Court [260] supports the view that only the second (ii) condition applies. I do not think that is correct and I am not convinced by the Court’s travaux analysis on this point [266] – I detail this in my forthcoming paper in the JPIL. As for that second condition, the CA holds [269] that ‘the exercise at this stage is a conceptual one, looking at the type of judgment to which the third state pending action may give rise, and evaluating whether it attracts recognition, or where applicable enforceability.’

Necessity for the proper administration of justice’ is dealt with [273] ff (although it confusingly includes discussion of more than just this ultimate A33-34 condition), starting with the discussion whether a stay was available or could be justified on a “consolidation” basis (effectively, an allocation of jurisdiction [275], or on a “wait and see” basis [temporary case-management: wait and see whether and to what extent the outcome of the case ex-EU affects the action in the member state]. [277] Underhill LJ takes a holistic approach: Does waiting for the outcome [of the Brazilian proceedings held to be related] give rise to advantages which sufficiently outweigh any disadvantages such that a stay is necessary? [279] The CA takes a broad approach to the issues that might be considered, including issues classic to a forum non conveniens analysis. I believe that is right, with the important caveat that A34 must not effectively be conflated with forum non (which is what the first instance judge had effectively done) (compare Ness).

[282] the Court takes a formalistic (and correct) view on the ‘related proceedings’ and their being ‘pending’:

for the purposes of the article 34 application, the nature and extent of overlap which falls to be considered when addressing whether and to what extent there is a risk of irreconcilable judgments, and in considering whether that risk weighs in favour of a stay being necessary for the proper administration of justice, is limited by reference to that which might be decided in the [pending Brazilian proceedings].

In particular, an advantage eg in winding-up proceedings viz the defendants or related undertakings, which could be obtained down the line from the outcome of the related proceedings, would not be caught by the comparative overlap and the likelihood of relatedness therefore is seriously reduced ([283] contrary to Turner J’s finding that that the list of areas in which potentially
irreconcilable judgments are liable to arise was “almost endless”).

[291] ff the CA makes its own assessment of the ‘proper administration of justice’ requirement given the judge’s core mistakes (particularly, his abuse conflation and the consideration given to future proceedings which are not pending).

[298] The CA holds that the continuation of the claim against BHP Australia (for which later in the judgment it finds that this is not barred on forum non grounds) in and of itself argues against an A34 stay (and that relevant parts of Lord Briggs’ speech in Vedanta do not change that).

Obiter [300] ff it lists other factors against a stay: [302] there is a real possibility that final resolution of the related BRA proceedings,  if they resume at all, is well over a decade away; [303] ‘For there to be a further delay of years, and quite possibly over a decade, before [E&W proceedings] could resume would cause very substantial prejudice to the claimants in obtaining relief, and would be inimical to the efficient administration of justice as a result of all the well-known problems which delay brings to the process’; [304] ff there are many disadvantages to the BRA proceedings including that these will not address the liability of the defendants in the E&W proceedings; [308] the degree of overlap between the proceedings is limited.

The forum non application is highly relevant given the English courts’ preponderant reliance on it, outside the BIa context, following UKSC Brownlie. Of note here is ia [345] the unrealistic prospect of the alternatives being suggested – I will leave the further forum non analysis to blogs less focused on European conflict of laws.

Rejection of a case-management stay is done succinctly, with Underhill LJ noting ia [374] that such stay would be incompatible with A34 and A4 BIa.

All in all I do not agree with each of the Court’s findings on tenets of A34, however in general the Court’s application reflects the correct approach to the Article, which very much makes a stay the exception.

Geert.

See also ‘Dude, where’s my EU court? On the application of Articles 33-34 Brussels Ia’s forum non conveniens- light rules’, Journal of Private International Law, forthcoming 2022.

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