The High Court has confirmed that the English court has jurisdiction over a claim for unpaid charges arising from a virtual data room contract, dismissing a jurisdiction challenge by a defendant seeking to litigate the dispute in France under French law: Intralinks Inc v Nexans SA [2026] EWHC 2355 (Comm).
The decision confirms that breach of an implied contractual obligation to pay into the bank account specified in an invoice can be sufficient to satisfy the jurisdictional gateway for a breach of contract committed within the jurisdiction. The old presumption that a debtor must pay the creditor at its place of business will often be displaced in modern commercial contracts. Accordingly, an invoice specifying payment at a bank account in England may be sufficient to found English court jurisdiction – subject to satisfying the court that England is the appropriate forum.
The decision also shows that the courts may be reluctant to reward a defendant who commences foreign proceedings to pre-empt a threatened English claim and seek to secure a more favourable legal framework. Such proceedings may be given only limited weight in the forum analysis, so as to prevent defendants using them to undermine the effect that the law gives to an English choice of law clause.
Background
Intralinks, a US company, provides virtual data rooms for use in corporate finance transactions. Nexans, a French cable manufacturer, used Intralinks' services for an M&A project.
A dispute arose between the parties about performance of, and payment under, the contract between them. Nexans disputed the charging structure and various invoices received from Intralinks. The invoices provided for payment to a bank account in England.
There was also a disagreement about when and how the contract was concluded. Nexans said the contract was formed on the terms of an unsigned work order dated 2 October 2024, which incorporated a Master Services Agreement (MSA) providing for French law and jurisdiction. Intralinks said that the contract was formed on the basis of a work order signed on 3 October 2024, which incorporated an MSA that provided for English law but was silent on jurisdiction.
Intralinks sent a letter before action asserting that the contract was governed by English law, claiming the sums due and requiring payment. Nexans did not reply. Instead it commenced proceedings in France, alleging that the French court had jurisdiction to hear the claim, the incorporation of the English MSA was an error, and the French MSA should apply.
Intralinks issued proceedings in the English court and obtained permission to serve abroad. Nexans challenged the court's jurisdiction, arguing that no jurisdictional gateway was satisfied and that Intralinks had not shown that England was the proper place to bring the claim.
Decision
Thomas Raphael KC, sitting as a Deputy Judge of the High Court, dismissed the jurisdiction challenge, holding that Intralinks had satisfied two jurisdictional gateways and also shown that England was clearly the proper place to bring the claim.
The applicable framework for service out of the jurisdiction was set out in CPR 6.36 and 6.37 and CPR PD 6B, paragraph 3.1. To justify the court assuming jurisdiction, Intralinks had to show that: (a) there was a serious issue to be tried; (b) there was a good arguable case that one of the jurisdictional gateways in PD 6B applied; (c) England was the proper place in which to bring the claim; and (d) the court should, in all the circumstances, exercise its discretion to permit service out. Nexans did not dispute that there was a serious issue to be tried, nor that the discretion to permit service out should be exercised if the gateway and proper place requirements were satisfied.
Contract formation
The first question for the court was whether the contract between Intralinks and Nexans was formed on the terms of the work order dated 2 October 2024, which incorporated an MSA providing for French law and jurisdiction, or on the basis of the work order signed on 3 October 2024, which incorporated an MSA providing for English law.
The court found on the facts that the contract was formed when it was formally signed by both parties on 3 October, and that it was agreed on the terms signed, ie on the terms of the 3 October work order and the English law MSA. Intralinks had the better of the argument in this regard. Its position was simple, straightforward and more plausible on the documents and evidence available. Even if a contract had been informally concluded on 2 October, the formal contract signed on 3 October included an entire agreement clause providing that it superseded all prior agreements.
Nexans’ alternative argument also failed, namely that, if the contract was formed on the basis of the 3 October work order, this was due to a mistake and the contract should be rectified such that it was governed by the French MSA.
Service gateways
Intralinks argued that two jurisdiction gateways under PD 6B applied.
Gateway 6(c) permits jurisdiction where a claim is made in respect of a contract which is governed by the law of England and Wales.
The court had concluded that Intralinks had the better of the argument that the contract at issue was formed on the terms of the 3 October 2024 work order and MSA, which included an English governing law clause. On this basis, Intralinks had a good arguable case that gateway 6(c) was satisfied.
Gateway 7 permits jurisdiction where a claim is made in respect of a breach of contract committed, or likely to be committed, within the jurisdiction.
Intralinks argued that Nexans' alleged breach of contract lay in non-payment of the disputed invoice, which Nexans was obliged to pay to a bank account in England. This meant that the breach was committed within the jurisdiction for the purposes of gateway 7.
Nexans argued that the default rule for the place of performance of a debt obligation was where the creditor is located (in this case, the US) and there was no contractual term overriding that default rule nor any contractual obligation to pay to the bank account specified in the invoices. The gateway therefore did not apply.
The court noted that the contract did not expressly state where payments had to be made. An old presumption holds that, absent express or implied agreement, a debtor must pay the creditor at its place of business. However, this presumption had an antique air in the modern world of multinational companies and electronic transfers and would often be displaced in commercial cases. In any event, in this case the presumption was displaced by an implied term that Nexans must pay fees properly invoiced according to the payment arrangements in the invoice, provided these were reasonably consistent with conventional commercial practice. Nexans could not pay how and where it chose. The payment clause in the contract, which required Nexans to pay the invoiced fees, impliedly required payment according to the invoice's terms.
In short, the invoice required payment into an English bank account. Pursuant to the implied term, Nexans had to pay into that account. The breach, in the form of non-payment, was therefore committed in England and consequently gateway 7 was satisfied.
England as the appropriate forum
The court noted the principles applicable to identifying the appropriate forum, which derived from Spiliada Maritime Corporation v Cansulex Ltd [1987] 1 AC 460. These essentially required asking whether England was clearly the most appropriate forum, taking into account all relevant connecting factors. This was not simply an assessment of convenience or expense. What mattered was how the factors made a particular forum more suitable for the ends of justice. The relevance and weight of any connecting factors depended on their interplay with the issues in the particular case.
The court then reflected on the following connecting factors:
- English governing law
The law governing the relevant transaction is generally a relevant connecting factor and may be of great importance. In this case, the English courts and the French courts were well able to apply foreign law, but a national court would generally be better placed to apply its own law than foreign law. That said, by choosing English law in the contract, but not English jurisdiction, the parties had left the question of jurisdiction open.
Although Nexans had sought to argue that, where gateway 6(c) (English governing law) was the only basis for establishing jurisdiction, the burden on establishing jurisdiction was high, in this case two gateways had been established and there were also connecting factors beyond English law. In any event, the test was simply whether England was clearly the most appropriate forum taking into account all relevant connecting factors. There was no different burden or test simply because gateway 6(c) was the gateway relied on.
- Location and language of documents and witnesses
Since the use of English in international commercial transactions was ubiquitous, the sole fact that documentation or negotiations were in English might not be of great weight. In some cases, the language of documents might be given a greater weight, because the need to engage with foreign language documents added to cost, complexity and risk of error. Despite the easy use, storage and transferability of electronic documents, and the ease of modern travel and the availability of video link, location could also remain relevant. Technology might shrink distance but could not fully substitute for physical presence, with evidence in person being superior to examination through video link. Witnesses generally also gave better evidence in a language they were comfortable with, with the use of interpreters being costly, awkward and prone to error. People were also usually more comfortable with their home country’s legal system compared to more alien systems.
- Overlapping foreign proceedings
The existence of overlapping proceedings in a foreign forum was a relevant connecting factor, but its force depended on the circumstances. Relevant factors included the stage of development of those proceedings, the degree of overlap, the extent of priority in time, the risks of multiple proceedings and the risk of conflicting judgments.
Nexans argued that France was the most appropriate forum because: the contract was governed by French law and jurisdiction; it was negotiated principally in France and in French; Nexans is a French company; many of the witnesses and much of the evidence would be in France, with none in England; the services at issue were consumed principally in France; connections to England created by payment of invoices to a bank account there were weak; and the French proceedings were a strong connection to France.
However, having considered all the circumstances of the case, the court held that England was clearly the most appropriate forum.
The court noted that the issues in the case were likely to include, in both England and France, debates as to formation and rectification and the incorporation of the English and French MSAs, as well as debates about the charges invoiced by Intralinks to Nexans, which under French law might be framed in terms of good faith, but in England might be framed under other doctrines such as incorporation of conversion rates, implied terms or estoppels, or claims for misrepresentation.
Applying the relevant connecting factors to the facts of the case:
- Nexans’ location in France pointed towards France. Intralinks was not English and had no relevant operations in England other than its bank account. It had connections to France, but its connections to Germany and the US were more significant. Nexans’ connection to the contract was also not solely French-focussed. Its German financial advisors had been closely involved in negotiations and its services were delocalised.
- Although Nexans might be more familiar with its home legal system, it had agreed to English law in a previous contract with Intralinks. As a US company, Intralinks was likely to be more familiar with the operation of the English common law system than the French system.
- The location of witnesses and evidence pointed more towards France than England, since Nexans' witnesses were likely to be French and much of the documentary evidence was likely to come from France, albeit alongside significant German and US connections. However, the language of documents and contemporaneous discussions, and the language abilities of the witnesses, pointed towards England. Debates about the charging structure under the contract were likely to be dependent on English documents and communications, and English was the only language in which all relevant witnesses were comfortable.
- The payments and obligations to pay in England were a significant connecting factor. All payments were made to England and Nexans was obliged to pay there. It was not unnatural for a party to be sued for payment in the place where it was obliged to pay.
- The choice of English law was a strong connecting factor in the circumstances of this case, which outweighed the factors pointing to France. The dispute was likely to turn on debates as to aspects of English contract law. A central aim of the French proceedings was to rely on doctrines of French law to create a very different legal framework, being more favourable to Nexans than that which would apply under English law. This was likely to be central to the motivation of the French proceedings.
- In this context, the existence of the French proceedings had limited weight. Although they provided a connection to France, they did not outweigh the force of factors making England the most appropriate forum. They had been launched without warning following Intralinks’ letter before action in order to pre-empt the English claim. Jurisdiction had not yet been established. There was a real prospect that the English proceedings would advance more quickly. The French proceedings had not progressed far, and the risk of duplicative proceedings and inconsistent judgments could be mitigated. In any event, defendants should not be allowed to bring reactive proceedings to undermine the effect, in appropriate cases, that the law attributes to English choice of law clauses.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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