3 June, 2014
Legal News & Analysis – Asia Pacific – India – Dispute Resolution
The recent decision in Pike & Doyle v The Indian Hotels Company Ltd (2013) has provided useful guidance on jurisdiction disputes.
The Claimants, a British couple, were injured in a terrorist attack on the Defendant’s hotel in Mumbai. Having returned to England, they issued a claim for damages in the High Court, but the Defendant (an Indian company) argued that India, not England, was the proper jurisdiction for any dispute.
The Law
Jurisdiction over defendants whose domicile is outside the UK is governed by common law, and the court’s permission is required to serve English proceedings on such a defendant. Permission will only be granted if:
1. There is a good arguable case that the claim is covered by PD 6B 3.1
2. There is a serious issue to be tried on the merits of the claim
3. England and Wales is the appropriate forum for the trial of the dispute
The Defendant accepted that the second condition had been met, but the first and third conditions remained in dispute. The Claimants maintained there was a good arguable case that PD 6B 3.1 (9)(a) applied (the claim being made in tort and the damage sustained within the jurisdiction), but the Defendant contended that the damage occurred in Mumbai, not England, such that the first limb of the test had not been fulfilled.
The Judgment
Stewart J considered Article 5(3) of the Brussels Regulation and noted that, under European case law, “damage sustained within the jurisdiction” meant direct damage only. He went on, however, to consider the recent High Court decisions in Wink v Croatia Osiguranje DD and Stylianou v Toyoshima, in which it was held that indirect or secondary damage was sufficient to give jurisdiction to the English courts.
The Judge preferred this wider interpretation and accordingly found that there was a good arguable case that the claim was covered by PD 6B 3.1 (9)(a), thus satisfying the first condition. He then considered whether the English courts were the appropriate forum for the trial. He referred to Spiliada Maritime Corporation v Cansulex Limited and, whilst acknowledging the need for caution when determining forum conveniens, held that England was the appropriate forum for trial, having regard to the interests of all the parties and the ends of justice. In this latter regard, Stewart J acknowledged that there was a risk that justice might be effectively unavailable in the foreign court (it being accepted that the Indian courts could take up to 20 years to determine the case).
Pike follows on from Wink and Stylianou and gives further authority to a wide interpretation of “damage” in the jurisdictional gateway for tort claims. However, unlike Wink and Stylianou, this decision was made whilst liability remained unresolved. Stewart J did not see this as a difficulty and found that Indian experts could present their evidence in English Courts. Therefore, there now appear to be very limited factors that would prevent a foreign defendant from being sued in England when a claimant has been repatriated following injury in a foreign jurisdiction.
Further, provided England is the forum conveniens, permission to serve proceedings outside the jurisdiction is likely to be given where indirect damage is sustained within the jurisdiction. This appears to extend English jurisdiction over foreign defendants and further encourages forum shopping.
For further information, please contact:
Peter Walmesley, Partner, Clyde & Co
[email protected]