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Articles, News | Mon 20th Feb, 2023
As the Retained EU Law (Revocation and Reform) Bill wends its way towards Royal Assent, we were interested to witness an early example of the unintended consequences that might result from its implementation. Readers will already be aware that the Bill, when enacted, will automatically revoke EU-derived law (unless specifically retained), and it has come to light that this may include the regulations which underpin part time judges’ pension rights. The long and the short of it is that more than 11,000 serving or former part time judges in England and Wales stand to lose pension benefits worth a total of £3.5 billion at the end of this year unless the Ministry of Justice takes action to retain their rights. We’re sure the situation has arisen as a result of an oversight on the part of the government (for who would deliberately set out to deprive judges of their hard-fought pension rights?), but it has led the team to wonder what other oversights might have occurred in the runup to the Bill’s presentation. We look forward to finding out in the coming months and years.
What’s in a Name?
Seeking to add or substitute a defendant once limitation has expired is always a perilous course, but personal injury practitioners generally have the safety net of CPR19.5(4) and an application under section 33 of Limitation Act 1980. The decision of DDJ Causton in Gregory v TUI Airways Ltd is a salutary reminder that for claims brought under the Montreal Convention, no such safety net exists and it is critical to identify the correct defendant at the outset.
The claimant sent a letter of claim to TUI UK Limited in relation to injury suffered on board an aircraft. The loss adjusters for TUI Airways Limited responded stating that TUI Airways Limited was the operator of the flight. Nevertheless, the claimant issued proceedings against TUI UK Limited, nearly two years after the accident. After limitation had expired, but before serving the claim form, the claimant purported to amend the claim form pursuant to CPR17.1 to name TUI Airways Limited as the defendant.
The defendant relied on the defence of limitation. Article 35 of the Montreal Convention (“the Convention”) provides that the right to damages is extinguished if an action is not brought within a period of two years. Of note, it is not just the remedy which is barred; the right to damages, the cause of action, is extinguished. The Limitation Act 1980 does not apply to claims brought under the Convention, and therefore, it was said, neither do CPR17.4 nor 19.5 which are parasitic upon it.
The judge considered the county court case of Hall v Heart of England Balloons Ltd  1 Lloyd’s Rep. 373 in which the claimant issued a claim against Heart of England Balloons Ltd which was not an existing entity at the time of the balloon flight. The claim had not been brought against the carrier, it had been brought against a different legal person and therefore it failed. The claimant in Gregory similarly had not simply made a typographical error in the name of the carrier, she had sued a different legal entity.
It was argued in Gregory (it seems, although the transcript of the ex tempore judgment, delivered over two hearings due to an intervening fire alarm, is a little unclear on this point), that there was a genuine error, the claimant had intended to sue the carrier and that this was just a case of correcting the name. Everyone knew that the intention had been to sue the carrier. DDJ Causton rejected this argument. In his judgment there was a big difference between the holiday company (TUI UK Limited) and the operator of the flight (TUI Airways Limited), notwithstanding their shared registered address.
As to the justice of the situation, albeit he did not purport to decide the claim on this basis, DDJ Causton noted that while on the one hand allowing the Claimant to make the correction might be said to do justice to her, it would subvert the Convention and in that sense would not give justice. It should be remembered that the Convention imposes a form of strict liability on carriers (and liability was not denied in this case). For that heavy burden on carriers there are a number of quid pro quos. One which often defeats claims is the need to prove that injury was caused by an “accident” as defined in the Convention. The two year limitation period, which is not capable of extension and which extinguishes the right to damages, may be seen as another.
DDJ Causton struck out the claim and held that there was only a “very, very limited pathway” open to a claimant in this situation. He did not attempt to set out what that pathway was but held it did not apply where the claimant had sued a different entity. While stressing that he was not going to hypothesise, he noted that it may be different if the error was simply one of spelling and it could be argued that the correct person had been sued.
Evidently this decision sets no precedent and will not bind any future judge. We are aware, however, of its reasoning having been followed by another court recently. In any event, it would be a foolhardy litigant who set out to rely on such reasoning being wrong. In all such cases it is essential that the precise identity of the carrier is identified and well in advance of the two year time limit. Of note, in Gregory the claimant had been told that she had initially identified the wrong entity, and had been advised of the correct entity. It is not apparent from the judgment why then she still issued proceedings against the wrong entity (although the fact that proceedings were issued in December 2020 when many travel litigators were busy with pre-Brexit claims may have been relevant!). It would be prudent in all Montreal Convention claims expressly to confirm the identity of the carrier in pre-action correspondence.
About the Author
Ella Davis was called to the Bar in 2013. She undertakes work in the cross border field on behalf of both Claimants and Defendants. She has particular expertise in claims involving allegations of fundamental dishonesty and has a good deal of experience in conducting trials around the issues which arise from such allegations.
More Jurisdictional Japes
The avalanche of jurisdictional challenges continues unabated. In Public Institution for Social Security v Ruimy  EWHC 177 (Comm) the High Court rejected a submission by two defendants in a large bribery claim that Switzerland was the more appropriate forum for any proceedings against them and that proceedings should therefore not continue in the courts of England and Wales. The Court found that there were connecting factors with England and few connections to Switzerland, but most importantly the English proceedings were well advanced, and allowing only part of the claim to be moved to Switzerland would carry a real risk of inconsistent judgments.
The Claimant is a Kuwaiti public institution responsible for that country’s social security system and pension scheme. It alleged that its former director, the lead Defendant, had obtained illegal secret commissions totalling US$874 million. It brought proceedings in England against him and at least 40 other Defendants, including the Applicants. The First Applicant was the chairman of a group of companies, including the Second Applicant, which was an English company. The Claimant alleged that it had invested over US$2 billion in funds managed by the Applicants’ group, but that the Applicants had paid Mr Ruimy secret commissions into Swiss bank accounts to influence that investment. The Claimant’s English claim was set for a 26-30 week trial beginning in March 2025; Mr Ruimy had died but the claim continued against his estate. Crucially, a small number of Defendants had successfully challenged the court’s jurisdiction against them, and the Claimant had commenced proceedings against those parties in Switzerland. The Applicants challenged the court’s jurisdiction and submitted that the claim against them should be stayed, as Switzerland was clearly the more appropriate forum for any proceedings against them.
The Court held that avoiding inconsistent judgments was often a significant factor in forum conveniens cases (cf the reasoning in Vedanta Resources Plc v Lungowe  UKSC 20,  A.C. 1045,  4 WLUK 148 ). In the instant case, that factor carried significant weight. The allegations against the Applicants were part of a US$874 million claim in England against Defendants who had submitted to English jurisdiction. A lengthy trial was listed. The court would hear evidence about a number of schemes including that of the Applicants, and that would include determining the extent and purpose of any payments from the applicants to Mr Ruimy. Accepting the Applicants’ application would result in allegations against Mr Ruimy, who was the alleged recipient of a bribe, being investigated in England, but allegations against the alleged payor being investigated in Switzerland. That carried a clear risk of inconsistent findings. The English proceedings had been under way for some time and were advanced. It would require strong factors to displace the view that England was the most appropriate forum.
No such factors existed in this case. The Second Applicant was an English company, operating in England during the relevant time, and the First Applicant had been living in England. Mr Ruimy had been the director of an English bank. The First Applicant did not have any substantial connection to Switzerland at all.
It was true that the alleged bribe payments had been made in Switzerland, but it was reasonable to infer that the agreement to pay had been made in England. The tort also had connections to Kuwait rather than Switzerland. Switzerland was not the centre of gravity of the dispute, either for documents or witnesses. The Applicants were not located there, and neither was Mr Ruimy’s estate. There were unlikely to be many Swiss witnesses. The Swiss proceedings did not include any claims about the Applicants’ scheme, whereas the English proceedings did. Any possible claims by the Swiss Defendants against the Applicants were speculative and would not progress until the English proceedings were resolved. Furthermore, there was no evidence that Swiss banking secrecy rules would impact the Applicants; they could waive secrecy regarding their own documents.
The decision in this case is perhaps unsurprising; presumably the Applicants felt that in a case of this size a jurisdictional challenge was worth a try, but the English courts have always been unwilling to allow such challenges where they are likely to give rise to the risk of inconsistent judgments. And in this particular case the strength of the ties with the alternative jurisdiction proposed was weak. A reminder that when arguing against the English courts retaining jurisdiction it is necessary to consider the strength of the ties that bind the case not only to England but to other potential jurisdictions.
About the Author
Called to the Bar in 1997, Sarah Prager has been listed in the legal directories as a Band 1 practitioner in travel law for many years. Together with her colleagues at Deka Chambers, Matthew Chapman KC, Jack Harding, Dominique Smith, Tom Yarrow and Henk Soede, she co-writes the leading legal textbook in the area, and has been involved in most of the leading cases in the field in the last decade. She undertakes purely domestic high value personal injury work as well as cross border work and has a wealth of experience of difficult and sensitive cases. She will be appointed a KC in March 2023.
 Recently published at civillitigationbrief.com
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