Collas Day has successfully represented investment company
Winnetka Trading Corporation before the Guernsey Court
of Appeal, and in doing so set a precedent in the law
relating to anti-suit injunctions and jurisdiction
clauses. The decision taken by the Court is also likely to
impact upon English law in this area.
A decision was first taken in November by the Royal
Court of Guernsey to apply an 'anti suit' injunction to
stop Winnetka taking proceedings against Bank Julius Baer in
England. This injunction was enforced as a result of a
'jurisdiction clause' in favour of Guernsey, contained
within the investment agreement between the two companies.
However, representing Winnetka in the Guernsey Court of Appeal
this month, Advocate Christian Hay argued that the clause was a
non-exclusive jurisdiction clause and that proceedings should be
permitted to continue outside of Guernsey. His position
concentrated on the difference between 'exclusive' and
'non-exclusive' and came down to what the parties meant by
the word "submit" when they agreed to "submit to the
jurisdiction of the Guernsey Courts".
On the one hand, it could be argued that "submit"
meant the parties would refer all disputes to Guernsey, giving
Guernsey exclusive jurisdiction. On the other hand, as successfully
argued by Winnetka, by agreeing to "submit" to Guernsey
courts, all that the parties had agreed was to 'yield' to
the Royal Court in the event that proceedings had commenced in
Guernsey, but had not agreed that proceedings couldn't be
commenced in another equally convenient jurisdiction
if necessary or desirable.
In agreeing with Advocate Hay's submissions, the
Court of Appeal also criticised and refused to follow
several recent English decisions which suggested there might not be
much difference between the effect of exclusive and
non-exclusive jurisdiction clauses. This judgment creates a
significant new precedent in the common law relating to anti-suit
injunctions in Guernsey and is highly persuasive in England
and many other common law jurisdictions.
Advocate Hay said: "The decision by the Court of
Appeal sets a strong and unambiguous Guernsey precedent. It
means that Guernsey companies will, now more than ever, need to
take extra care when drafting client agreements and carefully
consider the wording of jurisdiction clauses to ensure that the
intended meaning is clear."
An 'anti suit' injunction is an order
issued by a court that prevents an opposing party from
commencing or continuing a proceeding in another jurisdiction or
A jurisdiction clause is a provision in a
contract that refers disputes arising under the contract to a
country, territory or place for hearing and determination
For the full case notes or a copy of the judgment, please
contact Christian Hay or Michael Adkins at Collas Day via
Hannah Wakefield on firstname.lastname@example.org or
+44 (0)1481 734251.
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