English Litigation

English Litigation When can a case be litigated before the English courts and why would you want it to be?

TOPICS TO BE COVERED • Parties have made choices in their contract • What happens when the parties have not chosen? • Why would you want to litigate in England?

Choice of law clauses • Distinguish from choice of forum • Enables parties to specify law governing interpretation of agreement and its effect if dispute arises. • Benefits • Certainty • Predictability • May avoid undesired outcomes 12408642.1

Choice of jurisdiction • Before whom will disputes be re resolved • Benefits • certainty • Avoiding jurisdiction of “unfriendly” courts • Avoiding time and costs of dispute over jurisdiction later 12408642.1

Which jurisdiction to choose? Factors to consider: • Location of assets, potential witnesses, legal representation • Language • Quality of courts • What law will the courts be applying? • Speed and cost of litigation • Enforcement options 12408642.1

If English court is trying case involving “foreign” law element..... • English commercial court very experienced in doing this • But note that if want to rely on foreign law: • independent expert evidence on that law needed or • court will assume relevant foreign law is same as English law 12408642.1

Types of jurisdiction clauses • Exclusive: intended to prevent party from suing other in courts of any country other than one set out in agreement. • Non-exclusive: either party can sue other, either in courts of named country or in any country which has jurisdiction over dispute under its own rules. • Hybrid clauses: permit one party to sue in any jurisdiction (non-exclusive) but restrict other to one jurisdiction (exclusive) – only likely where inequality of bargaining positions. • Effect of pre-selection of jurisdiction 12408642.1

But what happens when no choice of law/jurisdiction is made? • No choice of law? • Complex rules but default position is that law will be that of country where party required to effect “characteristic performance” of contract has habitual residence. • No choice of jurisdiction? • Governing law does not necessarily decide jurisdiction (see VTB Capital v Nutritek) • So how does the question get decided? 12408642.1

How does the jurisdiction battle get decided? • If D cannot be served in England, C generally needs first to obtain English Court’s permission to serve proceedings out of jurisdiction (Berezovsky v Abramovich). • To get permission, and then maintain it in the face of a challenge, C must: • get through a “Gateway”; • show claim has reasonable prospect of success, and • establish England is forum conveniens

Getting through a “Gateway” (1) “Gateways” include: Claim made for injunction ordering defendant to do/stop doing act within jurisdiction. 12408642.1

Getting through a “Gateway” (2) Claim relates to contract made in England (egCherney v Deripaska). 12408642.1

Getting through a “Gateway” (3) • Claim in tort where damage felt, or tortious act committed, within England (eg VTB Capital plc v Nutritek and others). 12408642.1

Getting through a “Gateway” (4) • Defendant a “necessary or proper party” to proceedings in which another defendant (who can be served in England) is a party (egJSC BTA Bank v Ablyazov and others) 12408642.1

Getting through a “Gateway” (5) • Claim made to enforce judgment or arbitral award 12408642.1

Getting through a “Gateway” (6) • Claim made for interim remedy in support of main proceedings in Brussels/Lugano Contracting State or Regulation State 12408642.1

Showing reasonable prospect of success • Claimant must show it has reasonable prospect of success in the claim (eg OJSC Oil Co Yugraneft (in liquidation) v Abramovich) • Not always easy to resolve • Can be dangerous for a D not to provide a coherent answer to the claims– seeCherney v Deripaska 12408642.1

Forum Conveniens • If get through gateway and show reasonable prospect of success in claim, court then considers whether England is forum conveniens (Spiliada Maritime Corp v Consulex Ltd). • Generally this means case proceeds only if England is natural forum for resolution of dispute (see for example, VTB Capital v Nutritek) • But forum conveniensmay still be England even where not natural forum if it is where case may suitably be tried in interests of all parties and ends of justice. • CompareCherney v Deripaskawith decision in OJSC Oil Company Yugraneft v Abramovich and note absence of forum convenienschallenge in Berezovsky v Abramovich.

But why would you want the English courts to resolve your dispute? (1) • Experienced and able judges who - have shown independence from political/other pressure - offer speed and value for money

But why would you want the English courts to resolve your dispute? (2) • Availability of disclosure including as to assets • Breadth of pre-trial measures available (some extreme) • Ease of enforcement of English judgments in many jurisdictions (though not necessarily Russia)

Conclusions • Best to address choice of law and jurisdiction expressly in writing at outset of relationship • Choices require detailed thought • If no choice was made, take legal advice before taking any step that may affect outcome of dispute on where case should be heard • Test which law and jurisdiction suits you, and why, and then whether it is feasible that you will secure them

And finally............... ANY QUESTIONS?

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English Litigation