In early 2013, the claimant German reinsurer appointed the Swiss
defendant to provide loss adjusting services. This was a joint
instruction with another reinsurer, which had already entered into
a Master Agreement with the loss adjusters. The issue in this case
was whether the exclusive English jurisdiction clause in the Master
Agreement governed the relationship between the claimant and the
Article 23 of the Lugano Convention (which is materially the
same as Article 25 of the recast Brussels Regulation), provides
that, where one or more of the parties is domiciled in a Convention
country and the parties have agreed that the courts of a Convention
country will have jurisdiction, the courts of that country will
have jurisdiction, provided that the agreement is "in writing
or evidenced in writing".
Waksman HHJ noted that prior caselaw has confirmed that the
actual provision of a copy of the relevant terms is not required
where a party has clearly accepted them by reference.
Furthermore, jurisdiction clauses are not always automatically
incorporated where there is reference to standard terms. So, for
example, in The Ethniki , where a reinsurance
contract contained the express words "conditions: wording as
original", that was not sufficient to incorporate the
jurisdiction clause in the underlying insurance contract.
The judge concluded that here, although not all the terms of the
Master Agreement were incorporated into the instruction by the
claimant, "it would be odd if one of the jointly instructing
parties had a clause in favour of England whereas for the other
party, jurisdiction was at large. It also means that it cannot be
said that [the loss adjusters] would have had some objection in
principle to an English jurisdiction clause, had it been asked to
consider that matter because (as all the documents suggest), it
already accepted that it was contracting with [the other reinsurer]
on the basis of the Master Agreement". Furthermore, "the
very fact of a joint instruction commercially supports the notion
of instructions on the same terms".
Accordingly, the claimant had the better of the argument that
its instruction was subject to English jurisdiction, and hence the
loss adjusters' application to set aside service on it was
Lungowe v Vedanta Resources: Judge confirms that
Owusu is binding authority and English court has no
discretion to stay proceedings brought in England in favour of
proceedings in a non-EU court
In this case, Zambian residents commenced proceedings in England
against various defendants for alleged loss and personal injury
arising from environmental damage caused by a copper mine in their
area. One of the defendants is the holding company of one of the
mining companies. It is a UK company and so, relying on the ECJ
decision of Owusu v Jackson , proceedings were
commenced against the holding company and its Zambian subsidiary in
Article 4 of the recast Brussels Regulation provides that:
"Subject to the Regulation, persons domiciled in a Member
State shall, whatever their nationality, be sued in the courts of
that Member State." Owusu decided that if an English
court is seised of proceedings against a defendant domiciled in
England, it cannot stay proceedings in favour of a non-Member State
court on the ground that the non-Member State court is the more
appropriate forum to hear the case. The ECJ did not answer the
further question of whether this principle applies in all
circumstances (however, under the recast Regulation, since
10th January 2015 the EU courts have a discretion to
stay their proceedings in favour of a non-EU court if the non-EU
court was first seised (which was not the position in this case).
The non-EU court's judgement must also be capable of
recognition and enforcement in order for a stay to be granted).
Coulson J was invited by the defendant to find that
Owusu is a case on its particular facts and has no
application in this case. He declined to do so. He agreed that
there was force in the submission that the ECJ's reasoning is
"suspect": "Whilst the principle of certainty is
understood, reliance upon it here appears to ignore the fact that,
in these cases, it is the defendant himself who would prefer not to
be sued in the courts of his domicile". However, the fact that
the reasoning in Owusu might be said to be capable of
sustained criticism did not mean it was not binding. Coulson J said
he was bound to follow the decision.
The judge held that the English courts did have jurisdiction to
hear the claim.
Settling contentious claims without prejudice to liability is an everyday occurrence for most Insurers. The vast majority of claims which are subject to litigation are settled at some point in the course of the proceedings, and the settlement is usually expressed to be without admission of liability.
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