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Articles | Mon 12th Sep, 2022
This week the team has found time to consider two interesting cases on jurisdiction, which does seem to be a topic consuming a very large amount of court time, post-Brexit. We understand that various proposals seeking to simplify matters are currently being considered, and this would appear to be timely. Of course, as with everything, the devil is in the detail, and we look forward very much to having the opportunity to carp from the sidelines when the various options are publicised.
State Immunity and Forum non Conveniens
‘Suppose, to take a not entirely theoretical example, a foreign state (not, I emphasise, the Defendant) sends two agents to the UK to kill a dissident opponent by poisoning him. The operation is planned abroad. The radioactive poison is made abroad. The operatives bring the poison into the UK from abroad. They meet with the dissident in a London hotel, poison his tea, and he dies. The foreign state’s responsibility is clearly established by the evidence. Can the dissident’s representatives sue the foreign state in the High Court for damages for his wrongful death ? Or is the responsible foreign state immune from civil proceedings by virtue of the State Immunity Act 1978’
Under section 1 of the States Immunities Act 1978, a State is immune from the jurisdiction of the courts of the United Kingdom, unless one of a limited set of exceptions applies.
One of the exceptions is set out in section 5:
“A State is not immune as respects proceedings in respect of –
(a) death or personal injury; or
(b) damage to or loss of tangible property;
Caused by an act or omission in the United Kingdom”
It was this exemption which came to be considered by Mr Justice Knowles in Al-Masarir v Kingdom of Saudi Arabia [2022] EWHC 2199 (QB) in June of this year, with judgment recently handed down. By the claim, the Claimant alleged that his iPhones had been infected with spyware by agents of the Saudia Arabian State. He alleged misuse of private information, harassment, trespass to goods and assault, all occasioning personal injury in the form of psychiatric harm. The Defendant disputed jurisdiction, invoking the principle of State Immunity.
As with any jurisdictional hearing, there were of course several issues of fact for the Claimant to satisfy the court of, but two issues of perhaps more general interest: first, were these qualifying proceedings ‘in respect of death or personal injury’; second, was the injury ‘caused by an act or omission in the United Kingdom’?
As to the first question, one might be forgiven for thinking that the issue was already in the bag for the Claimant (provided he could prove the facts); his was demonstrably a claim for damages for personal injury. The hiccough for him was that customary international law recognises a distinction between acts done by a State in the exercise of sovereign or governmental authority – acta jure imperii – and acts done of a private law nature – acta jure gestionis. (Avid readers of this publication may remember an article by this author discussing such in the context of the Rome II Regulation.) In customary international law, claims impugning public law acts of foreign governments are not actionable in domestic courts. Indeed it is only by reason of the evolution of a ‘restrictive’ theory of immunity that private law acts have been carved out as justiciable. The Defendant therefore invited the court to interpret the words ‘act or omission’ in section 5 of the 1978 Act as excluding acts or omissions of an inherently sovereign or governmental nature in line with customary international law: the presumption was immunity and exceptions ought to be interpreted narrowly. In this case the planting of spyware (were the Claimant’s allegations proved) would be the acts of State agents exercising State authority.
How then was the statute to be interpreted in circumstances where it appeared to be at odds with public international law? That very question had been considered by Lord Diplock in the case of Alcom Ltd v Republic of Colombia [1984] AC 580, who had stated that although it was highly unlikely that Parliament intended to require the United Kingdom courts to act contrary to international law (as an aside – perhaps less likely in 1978 than it would appear to be in 2022), if the clear language of the statute compelled such a conclusion, then the language should be followed.
Indeed, that is a (if not, the) fundamental principle of statutory interpretation – if an English statute enacts a provision in plain terms then there is no need to look elsewhere for interpretative assistance. The plain terms should be applied. There is a presumption that the grammatical meaning of an enactment is the meaning that was intended by the legislator.
For Knowles J, the language was just so plain. The exemption from immunity in section 5 of the 1978 Act drew no distinction between acts of a public law and private law nature, where in fact other similar provisions of the Act did – e.g. section 3 which refers to a ‘transaction or activity … otherwise than in the exercise of sovereign authority’. Knowles J suggested that Parliament had therefore demonstrated that it well understood the dichotomy between acts done jure imperii and acts done jure gestionis, and has chosen not to draw the distinction within section 5 when it could easily have done so. He found support for his conclusion in the judgment of Ward LJ in Al-Adsani v Government of Kuwait (No 2) (1996) 107 ILR 536, who had in effect said that if the alleged torture in that case had happened in the UK then it would be justiciable in the UK pursuant to section 5. In Knowles interpretation an act of torture can definitionally only be an action of state authority – it was the very epitome of a sovereign or governmental act’ – and therefore Ward LJ’s comments could only mean that acta jure imperii were caught by section 5.
Perhaps most boldly, the Judge batted away comments of Laws J (as he then was) in the case of Propend Finance Pty Ltd v Sing (1997) 111 ILR 611 who had obiter considered this exact issue and come down on the other side. Despite referring to him as ‘one of the 20th century’s greatest judges’, Knowles considered Laws’ comments on the ‘flavour’ of section 5 as being of ‘ordinary private law claims’, and the view that acts causing personal injury were most likely to involve acts or omissions by State agents which were incidental to the State’s sovereignty rather than being integral to it, as being per incuriam.
As to the second issue – whether the action arose out of an act or omission in the United Kingdom – again, Knowles referred to the clear language of the statute. The clause used the indefinite article – an – rather than the. For him, there simply had to be an act or omission in the UK which was causative of the requisite damage on a more than de minimis basis. He found support in this conclusion by reference to the tort jurisdictional gateway in Practice Direction 6B, with which readers will be very familiar, where damage has been or will be sustained resulting from an act committed, or likely to be committed, within the jurisdiction’, and the pre-CPR ‘substantial and efficacious act’ gloss from Metall und Rohstoff AG v Donaldson Lutfin & Jenrette Inc [1990] 1 QB 391.
On all questions of fact, the Judge found that the Claimants had done enough to satisfy the interlocutory requirements. He dismissed the Defendant’s application challenging jurisdiction and ordered that the case proceed to a substantive Defence.
About the Author
Tom Yarrow was called in 2018. Before joining chambers Tom was a civil servant working in various government departments, including as a policy advisor on the UK-EU Withdrawal Agreement at the Department for Exiting the European Union. During pupillage he worked with the Government Legal Department, practising in public law in the fields of public international law, justice and security, human rights and immigration. He has regularly appeared in judicial review proceedings for the Secretary of State for the Home Department, and as a member of the Attorney General’s ‘junior junior’ scheme, he is able to take instructions directly from government clients. He now practises in all of chambers’ practice areas and is an enthusiastic and valued member of the travel team.
Managing ‘Unmanageable’ Claims and Forum non Conveniens
In a 107-page judgment in Municipio de Mariana v BHP Group (UK) Ltd [2022] EWCA Civ 951 the Court of Appeal considered applications for strike-out or stay of English litigation on the grounds of separate litigation proceeding in Brazil.
The Facts
The underlying facts related to Brazil’s worst ever environmental disaster, which occurred in 2015 when the Fundão Dam in South East Brazil collapsed, killing 19 people, destroying entire villages, and damaging the entire River Doce system over its course to the sea some 400 miles away. The cost of remediation and compensation was estimated to be a minimum of £25 billion at current exchange rates. Over 200,000 claimants sought compensation from the First Defendant, a company incorporated in England, and from the Second Defendant, a company incorporated in Australia. Both defendants operated together as a single economic entity.
Both defendants were served in England in May 2019. Jurisdiction was claimed in relation to the English defendant by virtue of its domicile here under Brussels Recast, and in relation to the Australian defendant by virtue of it carrying on business at offices here. By the time of service, a vast number of claims had already been made against other defendants in the Brazilian courts, and there was also an extensive compensation programme in place.
The application for strike-out or stays
In August 2019 the defendants applied to strike out or stay the claims on the grounds that:
i) Brazil was clearly the more appropriate forum (forum non conveniens);
ii) pursuant to article 34 of Brussels Recast, there were pending proceedings in Brazil giving rise to a risk of irreconcilable judgments; and
iii) the claims were an abuse of process, or alternatively should be stayed on case management grounds because they were pointless, wasteful and duplicative of the collective and individual proceedings and/or judgments in Brazil.
The Court of Appeal’s decision on Strike-Out
The Court of Appeal noted its wide general case management powers under CPR 1.1 and 3.1 to deal with cases justly and at proportionate cost, and to ensure that cases are dealt with expeditiously, and the court’s even wider powers in relation to group litigation orders under CPR 19.10 and 19.15. The court was able to select lead cases, try preliminary issues, and to adopt a staged approach.
After considering other illustrations of group litigation order deployment, including claims arising from the disposal of chemical waste in Côte d’Ivoire, damage to farmland caused by a pipeline in Columbia, and litigation against Volkswagen in relation to diesel emissions, and after considering the established authorities on abuse of process, the Court of Appeal held that the present claims did not in fact represent an abuse of process. Overturning the first instance decision, the Court of Appeal held that:
In terms of the risk of irreconcilable judgments, it was (as the judge at first instance had noted) impermissible to deploy an abuse of process argument in order to achieve through the back door that which Brussels Recast had barred through the front door. Even in rare cases where there was a risk of irreconcilable judgments, it would only be appropriate to allow a stay rather than to strike out proceedings. Forum non conveniens did not amount to such rare and compelling circumstances.
Looking at the issue of abuse afresh, the Court of Appeal held that the claimants had brought viable claims against the defendants in this jurisdiction as of right. They had brought no claims against the defendants in Brazil. The need for particular caution in striking out the English proceedings for being pointless and wasteful was “self-evident”. Claimants are in principle entitled to choose whom to sue. A claimant’s unhindered right of access to justice in respect of properly arguable claims is a core constitutional right inherent in the rule of law. As such, when the Henderson principle is not in play, it will be a rare case in which the court can say that there is no legitimate advantage in pursuing a defendant merely because there exists a claim for the same loss against another person.
The Applications for Stays
In relation to the application for a stay under article 34 of Brussels Recast, the Court of Appeal held that the application must fail. It was difficult to see how there could be any advantage in the claim being put on hold until the conclusion of the Brazilian litigation. A stay would not attenuate any risk of irreconcilable judgments, and would therefore be pointless. The court went on to say that in terms of the disadvantages of a stay, the most optimistic estimate for the resolution of the Brazilian class action was mid-2024 to mid-2026, possibly later if there are further appeals, to a long estimate of a decade from now. Further delay would cause very substantial prejudice to the claimants in obtaining relief and would be inimical to the efficient administration of justice. Against that disadvantage, there were uncertain benefits. First, it was uncertain as to whether the Brazilian class action suit would resume at all. Second, there was uncertainty as to what issues it would address. Third, there was uncertainty of the outcome, and fourth, the degree of overlap with the English proceedings was relatively limited. Fifth, the parties were distinct, so that nothing decided would be res judicata. As such, the court allowed the appeal against the order made pursuant to article 34 of Brussels Recast.
Lastly, in relation to the application for a stay on grounds of forum non conveniens, the court noted that it had already held that there was a cogent case that a new class action in Brazil would not be available, so that the only realistic alternative forum identified by the defendants (Brazil) was one in which there was a real risk that the claimants would not be able to obtain substantial justice. A stay should therefore be refused.
Conclusion
These fiercely contested applications brought by the defendants were robustly rejected in the Court of Appeal, but the fact that they succeeded at first instance in the High Court shows how difficult questions of jurisdiction and abuse of process can be. The applications took up 8 days of court time at first instance, and 5 on appeal. The key takeaway is that a strike-out will rarely (if ever) be appropriate on the basis that there is another forum available for litigation. Further, it is hard to imagine that any litigation could be struck out for being inherently unmanageable, given the constitutional importance of a claimant’s right to issue proceedings to vindicate rights. One must have at some sympathy with the judge at first instance who regarded the mass of claimants as unmanageable, but as the court noted, the court has wide case management powers and has at its disposal a variety of tools for the management of group litigation. On the more nuanced question of whether to grant a stay in cross border proceedings, the court should be slow to grant such stays without clear evidence that a claimant’s rights can be vindicated in another forum, and that this can be done within a reasonable time frame. A stay will almost always involve significant prejudice to a claimant who is thereby kept waiting for their remedy. The Court of Appeal’s judgment requires careful reading, but it looks to be something of a landmark decision in this area of law.
About the Author
Called in 2011, prior to pupillage Conor Kennedy spent two years working with a leading insurance law firm, gaining experience across regulatory, employment, leisure, travel and public sector teams. He has a varied civil practice and is accredited for Direct Access instruction, but has a particular interest and expertise in claims involving fundamental dishonesty.
…And Finally…
We hope to see many of our friends at the PEOPIL Annual Conference in Copenhagen this weekend. There will be no Roundup on Monday, not only because the team will be spending the weekend riding the Tivoli Gardens rollercoasters, but because we wouldn’t want our authorial efforts to be missed in what is likely to be a tsunami of print on that day. But the more things change, the more they stay the same, as dear old Jean-Baptiste Alphonse Karr concluded, and we will return the following week.
Call: 2011
Call: 2018
