The High Court in the BVI is often called to adjudicate upon applications for stays on forum non conveniens grounds. In a recent case, Febvre Company Limited v Grape Expectations SA, the Court had to consider, it seems for the first time, the issue of whether it was appropriate to stay on forum non conveniens grounds a claim for rectification of the share register of the defendant BVI company (represented by Harneys).
The claimant contended that it was entitled to be registered with shares in the defendant pursuant to an oral agreement subscription agreement. The defendant alleged that any entitlement to shares was part of a wider joint venture arrangement and was contingent upon the satisfactory performance by the claimant of distribution and administration agreements between the parties, which the defendant contended had not been satisfactorily performed. There were proceedings in Ireland in which the defendant was suing the claimant for alleged breaches of the distribution and administration agreements. Before the BVI High Court the claimant disputed that there were any binding distribution or administration agreements or that, if there were, it was in breach of them. In any event, its case was that any such agreements post-dated the subscription agreement and had no bearing upon it.
The claimant applied for summary judgment. The application was dismissed on the ground that there were triable issues. The defendant applied for a stay on the basis that Ireland was the most appropriate forum as there were pre-existing and ongoing proceedings there between the parties. The claimant contended that it was only the BVI High Court which had jurisdiction pursuant to the relevant BVI companies statute to order rectification of the share register of a BVI company. The defendant did not dispute this, but contended that it was open to the claimant to counterclaim in the Irish proceedings for a declaration that it was entitled to be registered with shares in the defendant. The defendant had also stated that it would abide by any decision of the Irish court on such a counterclaim.
The claimant relied upon the dicta of Harman J in the English case of International Credit and Investment Co (Overseas) Ltd and Anr v Adhan and others [1994] 1 BCLC 66: "Rectification of a share register is plainly a matter for the court of the country of incorporation of the company whose register is sought to be rectified, under which laws and which alone the company has its being." Justice Olivetti preferred to follow the approach of the English Court of Appeal in In re Harrods (Buenos Aires) Ltd [1992] Ch D 72 where it was held that the fact that the claimant was seeking relief under English companies legislation (in that case, an unfair prejudice remedy) in respect of an English company did not preclude the application of the general principles of forum non conveniens or render England automatically the appropriate forum. Applying the general principles of forum non conveniens to the facts and having regard to the ability of the claimant to obtain substantial justice (albeit not its preferred remedy) in Ireland, Justice Olivetti granted a stay.
The BVI is a major offshore incorporation jurisdiction. It was submitted on behalf of the claimant that for the Court to grant a stay of a claim concerning the membership and statutory records of a company incorporated within its jurisdiction in favour of an overseas tribunal, if accepted, would have many undesirable ramifications for BVI company law. This decision demonstrates that the Court is not afraid to apply the general principles of forum non conveniens to such a claim if substantial justice can thereby be done notwithstanding that a preferred statutory remedy cannot be obtained.
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