Mr Justice Nugee:
Introduction
- This is an application by the Defendant, a well-known English firm of solicitors practising in the City of London ("CMS"), for an anti-suit injunction restraining the Claimants, their former clients, from continuing or pursuing professional negligence proceedings against them in Antigua (properly Antigua and Barbuda, but I will refer to the country as Antigua). The present action in England is itself a parallel claim in which the Claimants make similar allegations against CMS, and CMS says that it is entitled to the benefit of an exclusive jurisdiction clause in its retainer under which it was agreed that such claims would only be brought in London.
Background
- The Claimants, Mr Hamilton-Smith and Mr Wastell, are two English licensed insolvency practitioners, formerly of Vantis plc (which is now in liquidation) and currently of FRP Advisory LLP. In 2009 they were appointed first as joint receiver-managers, and then shortly afterwards as joint liquidators, of a banking company incorporated in Antigua under the Antiguan International Business Corporations Act ("IBCA"), namely Stanford International Bank Limited ("SIB"). SIB was a company owned and controlled by Mr Allen Stanford, and it is now apparent that it was used by him and others to effect a large-scale "Ponzi" fraud on many investors in many countries, including not least the United States. Mr Stanford, as is well known, has been convicted in the United States on a number of counts relating to this fraud; and there is said to be a very large deficiency in the liquidation of SIB, quantified by the current liquidators at in excess of $5.9bn (all references to $ are to US dollars).
- In June 2010 the High Court of Antigua (part of the Eastern Caribbean Supreme Court), ordered, on the application of a creditor, that the Claimants be removed from office as liquidators of SIB, but that they should remain in office until a replacement was appointed. This took place in May 2011 when they were replaced as liquidators by a further order of the Antiguan High Court which appointed two individuals from Grant Thornton (a Mr Marcus Wide and a Mr Hugh Dickson) as joint liquidators.
- On 17 February 2015 SIB, acting by its current liquidators, issued a claim form in the Antiguan High Court against Mr Hamilton-Smith and Mr Wastell (and Vantis plc and FRP Advisory LLP). This claim ("the SIB claim") makes numerous allegations against Mr Hamilton-Smith and Mr Wastell in relation to their conduct of the affairs of SIB both while as receiver-managers and while liquidators. It seeks damages and other heads of financial relief; the claims have not been fully quantified but I was told that the pleaded losses amounted to some $42m, together with the possible loss of a claim of some $5.5bn (this relates to a claim which the current liquidators have brought against a Canadian bank, where the bank asserts (but the liquidators deny) that it is now statute-barred under Ontario law).
- The Claimants had retained CMS to advise them, initially in their capacity as receiver-managers and then in their capacity as liquidators. They had also instructed a firm of lawyers in Canada, now called Norton Rose Fulbright LLP but at the relevant time called Ogilvy Renault LLP ("Ogilvy"). The Claimants have not yet served a defence to the SIB claim, but intend to defend the claims made against them. Their position is that they did nothing wrong, but that if they did, they relied on the professional advice (or lack of it) from their lawyers, and have a claim to be indemnified by them.
- They have brought two sets of proceedings seeking such an indemnity. Their position is that Antigua is the natural forum for such a claim to be brought and on 9 September 2015 they therefore issued a claim form in the Antiguan High Court against both CMS and Ogilvy seeking an indemnity against any sums they might be ordered to pay in the SIB claim (or damages in that sum). Under the Antiguan rules of procedure, however, (the Eastern Caribbean Supreme Court Civil Procedure Rules 2000 ("the ECSC CPR"), which are modelled on English procedural rules), they require permission to serve that claim out of the jurisdiction. Since there may be limitation issues, they therefore also brought this claim in England against CMS (alone), again seeking an indemnity and/or damages. The claim form was issued on the same day as the Antiguan proceedings, 9 September 2015.
- The claims made against CMS by the Claimants in the Antiguan action and this one appear to be materially identical – at any rate no differences of substance between them were identified to me. Before me, Mrs Talbot Rice QC, who appears for the Claimants, made it clear that the Claimants do not wish or intend to pursue both sets of proceedings: her overall submission is that the appropriate place for these claims to be tried is Antigua; that it should be left to the Antiguan Court to decide whether it will accept jurisdiction; and that if it does so, the English proceedings will not be pursued. They were only issued in case the Antiguan Court declined jurisdiction.
- I should briefly note the position with Ogilvy. Unlike CMS (see below) the Claimants did not enter into any retainer letter with Ogilvy and there is no question of there being any contractual exclusive jurisdiction clause. The Claimants have applied to the Antiguan Court for permission to serve their Antiguan proceedings on Ogilvy out of the jurisdiction, and are awaiting the outcome of that application. The Claimants have not brought any proceedings against Ogilvy in Canada, and the evidence before me is that Ogilvy has not at any stage asserted that Antigua is not an appropriate jurisdiction for the Claimants' claims against it; on the other hand, the fact that the Claimants have had to issue an application for permission to serve Ogilvy out of the jurisdiction indicates that Ogilvy has not submitted to the jurisdiction of the Antiguan Court.
The Claimants' retainer of CMS
- On 16 February 2009 the US Securities and Exchange Commission ("the SEC"), which, after an investigation into Mr Stanford's affairs, had concluded that he had carried out a massive Ponzi fraud on investors, appointed a Mr Janvey to be receiver of SIB's assets wherever situated in the world.
- The next day the Antigua Financial Services Regulatory Commission ("the FSRC") contacted Mr Wastell to discuss the possibility of him and Mr Hamilton-Smith accepting appointment as joint receiver-managers of SIB. The two of them were known to the FSRC because they had acted in the insolvency of an Antiguan company called BetonSports (Antigua) Ltd in 2007-8. This was the subsidiary of an English company called BetonSports plc of which they were the joint liquidators, and they were appointed first as receiver-managers and then in due course liquidators of the Antiguan subsidiary. They instructed Mr Peter Wiltshire, a partner in CMS, to act for them both in the liquidation of BetonSports plc and in relation to the affairs of BetonSports (Antigua) Ltd, signing formal retainer letters for each. My attention was drawn to the fact that in the retainer letter for the Antiguan company, signed by Mr Wastell in October 2007, it said, under the heading of "The scope of our retainer":
"We will advise you generally in your capacity as receivers-managers, and/or liquidators of BetonSports (Antigua) Ltd, a company registered in Antigua and Barbuda."
- Mr Wastell therefore contacted Mr Wiltshire again in connection with the proposed appointment over SIB and Mr Wiltshire agreed on behalf of CMS to act for them. That was on 18 February 2009. On the next day, 19 February 2009, Mr Hamilton-Smith and Mr Wastell flew to Antigua accompanied by Mr Wiltshire and another lawyer from CMS (and some other Vantis employees), met the FSRC, and were formally appointed by the appropriate official of the FSRC (a Mr Paul Ashe) as receiver-managers of SIB, and of an associated company called Stanford Trust Company Ltd ("STC"), under statutory powers contained in s. 287 of the IBCA which permit such an appointment to be made out of court. Under s. 288 of the IBCA a receiver so appointed is obliged within 30 days to begin court proceedings for liquidation and dissolution of the corporation, or for the re-organisation of the corporation, as the circumstances may require. On 26 February 2009 that appointment was followed by an Order of the Antiguan Court, made on the application of the FSRC, which among other things appointed them joint receiver-managers of SIB and STC pursuant to s. 220 of the IBCA. This section confers power on the Court to appoint a receiver-manager on the application of any interested person. There was some discussion before me whether this operated as a confirmation of their appointment under s. 287 (with the result that the 30-day obligation in s. 288 still applied), or as a substitute appointment to that under s. 287 (with the result that the 30-day obligation in s. 288 fell away); I do not propose to decide, or even consider, this point, which is self-evidently a matter of Antiguan law and one on which I have no evidence either way. On the view I take, it is not material.
- On 27 February 2009 Mr Hamilton-Smith signed a retainer letter with CMS ("the Retainer Letter"). Quite a proportion of the argument was devoted to examining its terms so I should set out the relevant parts of it.
- It is dated the same day and addressed to:
"Mr Nigel Hamilton-Smith and Mr Peter Wastell
Joint Receivers of Stanford International Bank Limited
c/o Vantis Plc"
followed by an address in St Albans, England.
- It is headed "Stanford International Bank Limited ("the Company")" and continues:
"Thank you for your instructions in this matter… I set out below the basis on which we propose to act on your behalf.
This retainer letter and our enclosed General Terms & Conditions of Business ("General Terms and Conditions of Business") are incorporated into the contract between us and you (the "Retainer") for this assignment… Please note that, unless otherwise agreed, the General Terms and Conditions of Business shall apply to any subsequent work which we undertake on your behalf.
As well as recording the scope of the Retainer, this letter sets out some information (including information on costs and personnel) relating specifically to this matter.
1. Statement of your objectives and options
Having been appointed Receiver – Managers of the Company, you are concerned to gather in its assets and to establish reliable information about the identity and value of the Company's creditors. You face particular difficulties in this case because of the prior purported appointment of a Receiver by a court in the United States and because of the sudden nature of your own appointment. You also have to deal with the relevant authorities in Antigua, where the Company is based and to gather in assets located in a number of different jurisdictions.
2. Agreed next steps
We will continue to provide you with support as you seek to establish information about the Company's creditors and about its assets. Where assets have been located we will work with you with a view to preserving those assets, to addressing any issues in the relevant jurisdiction and achieving a collection of the assets. We will also work with you in designing and implementing an appropriate strategy for your dealings with the Receiver who has purportedly been appointed in respect of the Company by the US court, and in relation to the temporary restraining order made by the US Court on the application of the US SEC.
…
5. Reporting arrangements/costs-benefit risk
We are in constant contact with you at present, but will agree a regular reporting programme with you as the matter develops.
…
It is not possible, at this stage, to form a view as to when our work is likely to be completed.
…
7. Estimate of costs
Given the uncertain nature and extent of the work we will be undertaking on your behalf, it is not possible to provide a meaningful estimate of our likely charges."
There is no reference anywhere in the Retainer Letter to the prospective liquidation of SIB, or to Messrs Hamilton-Smith and Wastell acting as or being appointed as liquidators.
- CMS's General Terms and Conditions of Business ("the General Terms"), referred to in the Retainer Letter, provided, so far as material, as follows:
"2. These General Terms and Conditions of Business and "You"
2.1 These are the General Terms and Conditions of Business which will apply to the services which we provide to you as our client in relation to any matter on which you retain us, unless otherwise agreed.
2.2 When you instruct us to advise you on a new matter we shall normally send you a letter (a "Retainer Letter") confirming your instructions, save where the instructions constitute repeat business. The terms of that letter (if any) and these General Terms and Conditions of Business will be incorporated in the contract between us (the "Retainer") for that matter.
2.3 We shall normally indicate in the Retainer Letter, or separately in writing, the person or persons who are to be our clients for that matter. The expression "you" where used in Clause 12 shall refer to each such person save that in paragraph (b) of Sub-clause 12.1 and in Sub-clauses 12.2 and 12.4, it shall refer to all such persons collectively. Elsewhere in these General Terms and Conditions of Business the expression shall mean each or all of such persons as the context requires.
2.4 In the event of any inconsistency between the Retainer Letter and these General Terms and Conditions of Business, the Retainer Letter shall prevail.
3. Scope of our services
3.1 The services we provide in relation to any matter will be described in the Retainer Letter or will otherwise be agreed between us at the outset of the matter and may be varied by agreement during the course of the matter.…
…
30. Law and jurisdiction
30.1 The Retainer shall be subject to and governed by the Laws of England and Wales. Subject to Clause 31, any dispute arising out of or in connection with the Retainer shall be subject to the exclusive jurisdiction of the High Court of Justice, The Strand, London, England.
…
33. Application of these terms and amendments
33.1 These terms supersede any earlier terms of business we may have agreed with you and, in the absence of express agreement to the contrary, shall apply to the services referred to in the Retainer Letter (if any) and all subsequent services which we provide to you."
- On 15 April 2009, on the petition of Mr Ashe as the appropriate official of the FSRC, the Antiguan High Court ordered that SIB be liquidated and dissolved and that the Claimants be appointed joint liquidators.
- CMS continued to act for the Claimants after their appointment as liquidators. No fresh retainer letter was entered into. There is evidence that one was drafted, but was not in fact sent to the Claimants or proceeded with. It does not seem to me to matter, and I do not propose to consider, whether this was because it was concluded that it was unnecessary, or was an oversight, or indeed for some other reason. The fact is that there was only one written retainer letter.
Principles for grant of anti-suit injunction
- The primary ground on which CMS seek to restrain the Antiguan proceedings is that they have been brought in breach of the exclusive jurisdiction clause in cl 30.1 of the General Terms. The basic principles applicable to an anti-suit injunction based on such a clause are not in dispute:
(1) The test for determining at the interim stage whether an exclusive jurisdiction clause applies to a claim is whether the applicant has shown "to a high degree of probability" that it is right, or whether the English Court "can point with confidence" to a contractual promise not to litigate elsewhere: see American International Specialty Lines Co v Abbott Laboratories [2002] EWHC 2714 (Comm), [2003] 1 Ll Rep 267 at 275 col 2 per Cresswell J, Transfield Shipping Inc v Chiping Xinfa Huayu Alumina [2009] EWHC 3629 (QB) at [53] per Christopher Clarke J. A "good arguable case" (as in Transfield) or even a "strongly arguable case" (as in Midgulf International Ltd v Groupe Chimique Tunisien [2009] 2 Ll Rep 411) is not sufficient: see Midgulf at [39] per Teare J.
(2) An anti-suit injunction is a discretionary remedy, but where there is an English exclusive jurisdiction clause the discretion will "ordinarily" be exercised to grant an anti-suit injunction unless there are "strong reasons" not to exercise it, the burden being on the party opposing the grant of an anti-suit injunction to show there are such strong reasons: see Aggeliki Charis Compania Maritima SA v Pagnan SpA (The "Angelic Grace") [1995] 1 Ll Rep 87 at 96 per Millett LJ, Donohue v Armco [2001] UKHL 64 at [24] per Lord Bingham.
- Mr Harvey QC, who appears for CMS, says that the exclusive jurisdiction clause applies to all the claims brought by the Claimants in their Antiguan proceedings, and that the Court can be satisfied of this to a high degree of probability.
- The claims which the Claimants might have against CMS can in principle be divided into 4: (i) claims in contract in respect of services provided to them as receiver-managers ("receiver contract claims"); (ii) claims in tort in respect of such services ("receiver tort claims"); (iii) claims in contract in respect of services provided to them as liquidators ("liquidator contract claims"); and (iv) claims in tort in respect of such services ("liquidator tort claims"). I will consider them in turn.
Receiver contract claims
- So far as receiver contract claims are concerned, it is not disputed that the General Terms were duly incorporated into the contract formed by the Retainer Letter, and in their Statement of Claim in their Antiguan proceedings the Claimants expressly accept that the exclusive jurisdiction clause at cl 30.1 of the General Terms applied to that retainer. They have not however sought to rely on any receiver contract claims in their Antiguan proceedings against CMS, but have confined their claims to tort claims (both receiver and liquidator) and liquidator contract claims. (As I read their Particulars of Claim in the action before me the same is also true of their English claim, although nothing I think turns on this). The Claimants' acceptance that receiver contract claims are subject to the exclusive jurisdiction clause does not therefore make any difference to the claim for an injunction.
Receiver tort claims
- So far as the receiver tort claims are concerned, Mrs Talbot Rice did not formally concede that they were covered by the exclusive jurisdiction clause but after I indicated my provisional view that they probably were, she did not put forward any argument to the contrary. Without purporting to finally decide the point, I am satisfied, to the requisite high degree of probability, that they very probably are, for the following reasons.
- First, the natural meaning of the words "any dispute arising out of or in connection with the retainer" is in my view apt to cover a dispute whether CMS were in breach of a tortious duty of care when providing services under the retainer, as the duty of care itself arises out of the services so provided.
- Second, there is authority to the effect that a clause in a charterparty covering "all disputes arising out of this contract" covered a claim in tort for damage caused by a collision in the course of discharge operations since:
"the claim in tort cannot in my judgment be segregated from the cross-claims under the charterparty … the same facts founded the owners' claim in tort as founded the claims and cross-claims in contract."
See The Angelic Grace at 91 cols 1-2 per Leggatt LJ, applying the dictum of Mustill J which was approved by the Court of Appeal in The Playa Larga [1983] 2 Ll Rep 171, namely that a tortious claim "arises out of" a contract if there is a sufficiently close connection between the tortious claim and a claim in contract, one example of which is if the contractual and tortious disputes are "so closely knitted together" on the facts that an agreement to arbitrate one can properly be construed as covering the other. On this test it is difficult to think of an example of tortious and contractual claims being more closely connected or knitted together than claims for professional negligence: it is standard in my experience for claimants to bring contractual and tortious claims against professionals on precisely the same facts, and it is often difficult to discern any practical difference between the two causes of action other than the limitation periods applicable (even the tests for remoteness of damage having recently been assimilated by the Court of Appeal).
- Third, in any event, the House of Lords has deprecated the drawing of fine distinctions based on linguistic nuances in the various phrases used in clauses such as this. The principle is that the construction of such a clause should start from the assumption that the parties as rational businessmen are likely to have intended any dispute arising out of the relationship into which they have entered to be decided by the same tribunal: Fiona Trust & Holding Corporation v Privalov [2007] UKHL 40 at [13]. That was in fact said in relation to an arbitration clause, but there can be no doubt that the same principle applies with equal force to jurisdiction clauses, which are intended to do the same thing: see the discussion of this point by Lewison J in Skype Technologies SA v Joltid Ltd [2009] EWHC 2783 (Ch) at [14]-[17], which with respect is obviously right. On this principle, even if the language were much less favourable to CMS, the Court would start with the assumption that an exclusive jurisdiction clause in a professional retainer was likely to have been intended to cover claims in tort as well as claims in contract.
- For these reasons I think Mrs Talbot Rice was well advised not to press any argument that the receiver tort claims were outside the scope of the exclusive jurisdiction clause.
Liquidator contract claims
- So far as the liquidator claims are concerned however, that was much more vigorously disputed between the parties. Mr Harvey's position was that there was a single retainer of CMS by the Claimants, whether as receiver-managers or liquidators, and that that single retainer was on the terms of the Retainer Letter (labelled by him Ground 1); alternatively, if there was a fresh retainer of CMS by the Claimants as liquidators, the General Terms were incorporated into that retainer by virtue of the express provisions to that effect in the Retainer Letter (Ground 2). Mrs Talbot Rice's position was that it made all the difference in what capacity the Claimants retained CMS: the Retainer Letter only covered the retainer of CMS by the Claimants in their capacity as receiver-managers, there being a fresh retainer (or series of retainers) when they instructed CMS in their capacity as liquidators; and that the General Terms were not incorporated into that fresh retainer as that was not a retainer by them in the same capacity.
- So far as Ground 1 is concerned, Mr Harvey made a number of points. He said that it was always likely that the Claimants would in due course be appointed as liquidators: not only was this envisaged by s. 288 of the IBCA, but the impetus for the appointment of the Claimants was the appointment by the SEC of Mr Janvey in the US as receiver with a purported right to get in assets worldwide, and the intended strategy to counter this was to move to liquidation and then apply for recognition of the liquidators' title in other jurisdictions. He referred to the fact that CMS's services followed the practice which had been adopted by the parties in relation to BetonSports (Antigua) Ltd where the Claimants had first been appointed joint receiver-managers and then joint liquidators.
- Mr Harvey said that the Retainer Letter set out the scope of the services broadly, and that against this background the reference in the Retainer Letter to "this matter" should therefore be interpreted widely to include advice given to the Claimants both while acting pursuant to their existing appointment as receiver-managers, and if and when they were appointed liquidators as it was anticipated they might be. This accorded with what actually happened: throughout the period from early March up to 15 April 2009, workstreams were being undertaken in anticipation of the Claimants being appointed liquidators; and when they were so appointed, many of the workstreams continued without a break; there was no change to CMS's working practices, fee earners or hourly rates. Nor could it be said that the retainer of CMS pursuant to the Retainer Letter terminated on the Claimants' appointment as liquidators: even after that date CMS assisted the Claimants with their reports to the Antiguan Court, which detailed their actions as receiver-managers, and continued to do so until their final report in May 2011. He also made the forensic point that the suggestion that there had been two retainers rather than one had only been made recently: in their final report of May 2011, the Claimants had exhibited the Retainer Letter without any suggestion that it only applied to the receivership period; and the early correspondence from DAC Beachcroft on behalf of the Claimants to CMS referred to only a single retainer.
- Despite these arguments, I am not persuaded to the necessary high degree of probability that as drafted the Retainer Letter covered both receivership and liquidation. In principle the scope of the retainer created by a written retainer letter is a question of construction of that document. As Mrs Talbot Rice pointed out, the Retainer Letter is addressed to Messrs Hamilton-Smith and Wastell not just by name but by description as "Joint Receivers"; and when it then refers to "your instructions in this matter" and "the contract between us and you … for this assignment", the natural reading of "this matter" and "this assignment" is to my mind the joint receivership. This is reinforced by the "Statement of your objectives and options" which refers to the Claimants having been "appointed as Receiver – Managers", and describes their objectives (gathering in assets and establishing information about creditors) in terms of that appointment. On the face of it, the subject-matter of the letter is the Claimants' appointment as receiver-managers, and the work to be done under it is work for them in that capacity.
- It is true that the Retainer Letter defines the services to be provided broadly, indicating that "the matter" was likely to develop, that it was not possible to form a view when "our work" was likely to be completed, and that the nature and extent of "the work we will be undertaking" was uncertain. But this does not seem to me to assist on the question whether the "matter" and the "work" here referred to was limited to the receivership or extended to the liquidation. What is noticeable is that although broadly stated, there is no reference in the "objectives and options", or "agreed next steps", or anywhere else, to liquidation; or to not only gathering in and preserving assets but also distributing them. (There is an instructive contrast with the draft retainer letter relating to the Claimants' retainer of CMS as liquidators, which was prepared but never sent; this refers to the Claimants gathering in assets and obtaining information about the Company's creditors "in order to ultimately realise and distribute those assets"; this draft letter, being later and not in fact provided to the Claimants, is not of course admissible on the question of construction of the Retainer Letter, but it does neatly illustrate the different nature of a liquidator's functions.)
- I do not think this prima facie interpretation of the Retainer Letter is displaced by the fact that it was anticipated that the Claimants might be appointed liquidators in due course. There is in fact a dispute on the evidence as to how likely this was seen as being. I cannot resolve this dispute, but I do not regard it as significant: the Claimants' appointment as liquidators was on any view something that might happen but was not certain to happen, and the very fact that it was envisaged as something that might happen makes it noticeable that the Retainer Letter says nothing express about it.
- Nor do I think it assists Mr Harvey to point to the precedent of BetonSports (Antigua) Ltd where the Claimants' appointment as receiver-managers had been followed by that as liquidators; as Mrs Talbot Rice said, the difference in that case was that the retainer letter expressly referred to CMS advising the Claimants "in your capacity as receiver-managers and/or liquidators". If anything, the failure to include a similar reference in the Retainer Letter suggests that it was not intended to do the same thing.
- So far as the continuity of workstreams is concerned, there is nothing surprising either in work being done before 15 April 2009 in anticipation of the Claimants being appointed as liquidators, or of particular workstreams carrying on seamlessly after appointment; nor in the fact, accepted by Mrs Talbot Rice, that the services provided by CMS to the Claimants that can be characterised as receivership services (such as assistance with drafting of reports to the Court) continued even after their appointment as liquidators, although no doubt most of the services they provided after that date were in respect of the liquidation. I do not regard these points as determinative: in principle I agree with Mrs Talbot Rice that the Claimants instructed CMS in two different capacities, first as receiver-managers and then as liquidators, and that however continuous the workstreams were, the work done by CMS was in principle either work done for the Claimants in one capacity or the other. The evidence is that CMS opened a new file reference for the liquidation (different from that which had applied to the receivership), and billed the Claimants separately. This is no more than one would have expected and illustrates that CMS recognised that the services provided to the Claimants as liquidators could be distinguished from the services provided to them as receiver-managers, just as the Claimants in their reports to the Court distinguished between their receipts and payments as receiver-managers and their receipts and payments as liquidators.
- In these circumstances I consider that there are, to put it at its lowest, real doubts whether the Retainer Letter, in referring to "this matter", was wide enough to include services provided by CMS to the Claimants as liquidators. Far from being satisfied that it is highly probable that the Retainer Letter on its true construction extended to the liquidation, I think it is probable that it did not.
- Mr Harvey had another argument under Ground 1. He referred to cl 3.1 of the General Terms which provided that the services in relation to any matter would be described in the Retainer Letter, and:
"may be varied by agreement during the course of the matter."
If therefore services in respect of the liquidation were not included in the Retainer Letter, he said that the parties had nevertheless varied the scope of the services to be provided by agreement during the course of the matter.
- Although deployed as part of Mr Harvey's argument on Ground 1, it is more convenient to take this point together with Ground 2. Here Mr Harvey's submission was very simple. Even assuming there was a separate retainer, or series of retainers, of CMS by the Claimants as liquidators, the express terms of the Retainer Letter provided that the General Terms should apply. He relied on:
(i) the second paragraph of the Retainer Letter which provided that the General Terms:
"shall apply to any subsequent work which we undertake on your behalf"
(ii) cl 33.1 of the General Terms which provides that they should apply, in the absence of any agreement to the contrary:
"to the services referred to in the Retainer Letter (if any) and all subsequent services which we provide to you"
and
(iii) cl 2.2 of the General Terms which provides that "when you instruct us on a new matter" a Retainer Letter would normally be sent and that the terms of that letter (if any) and the General Terms:
"will be incorporated in the contract between us … for that matter."
He might equally have referred to:
(iv) cl 2.1 of the General Terms which provides that the General Terms will apply to:
"the services which we provide to you as our client in relation to any matter on which you retain us, unless otherwise agreed."
- Mr Harvey said that these provisions had the effect that when the Claimants as liquidators carried on using the services of CMS this was either a variation of the original retainer (in which case cl 3.1 applied, and hence the Retainer Letter, and the General Terms thereby incorporated, applied to it); or a new retainer, in which case it was "subsequent work which we undertake on your behalf", or "subsequent services which we provide to you", or a "new matter" on which "you instruct us", within the meanings of the second paragraph of the Retainer Letter, and cll 33.1 and 2.2 respectively of the General Terms (and equally "any matter on which you retain us" within cl 2.1), in any of which case the General Terms were incorporated.
- Mrs Talbot Rice had only one submission to the contrary, which is that capacity is all-important so that a distinction is to be drawn between the retainer of CMS by the Claimants as receiver-managers and as liquidators. I have already accepted for the purposes of Ground 1 that there is a distinction between the two capacities in which the Claimants acted, but this submission goes further. On analysis, it is really a submission that "you" and "your" when used in the Retainer Letter and General Terms only refers to the Claimants in their capacity as receiver-managers so that work carried out for them and instructions by them to act in a new matter do not count for the purposes of the various provisions relied on unless the instructions are given in that same capacity.
- I am not attracted by this submission. It is ultimately a question of what "you" means; but "you" naturally means the persons to whom the Retainer Letter is addressed, (or, as it is put in cl 2.3 of the General Terms, the "persons who are to be our clients for that matter"). The "matter" referred to in the Retainer Letter may be (and I have already said that I think it probable that it is) limited to the receivership, but the persons who were CMS's clients were Mr Hamilton-Smith and Mr Wastell. As Mr Harvey said, they are two individuals and the contract is with them; it is not a contract with the company in receivership. The purpose for which they instructed CMS was to assist them in fulfilling their functions as receiver-managers; this was no doubt primarily for the benefit of the receivership estate and ultimately the creditors, but it was also in part to protect themselves as individuals, as indeed is illustrated by the claims they now seek to make, which are claims to be indemnified against personal liability to SIB. When they instructed CMS to assist them in fulfilling their functions as liquidators, this was no doubt a new and different matter, but it was the same individuals who instructed them. As a matter of ordinary language this seems to me to be caught by the words "when you instruct us on a new matter" and the like.
- This also seems to me to make commercial sense. If Mrs Talbot Rice were correct, it would mean that the provisions in the Retainer Letter and General Terms applying the General Terms to subsequent instructions would have a surprisingly narrow application. To take an analogy used in argument, if A and B instructed CMS as trustees of one trust, and then instructed the same partner to do something very similar in relation to another trust, the second set of instructions would not be a "new matter" on which "you instruct us"; indeed, as Mrs Talbot Rice accepted, it would mean that if A and B were appointed executors and trustees under a will, and retained CMS as executors, the General Terms would not be incorporated into their subsequent retainer of CMS as trustees, since to act as a trustee of a will is to act in a different capacity from that of executor, however closely connected the two may be in practice. Coming closer to the present case, if A and B were appointed receivers of one company, it would mean that the General Terms would not be incorporated into their retainer of CMS in relation to any other receiverships, however closely connected, so that for example the General Terms would not apply, in the absence of a separate retainer letter, to work done for them as receivers of subsidiaries. Or, as here, their continuing retainer of CMS to act post-liquidation would not be included, however likely it was that they would be so appointed, and however closely connected their work as receivers and liquidators might be.
- None of this seems to me to make good commercial sense. It is no doubt good practice for a firm of solicitors to issue a new retainer letter for each new matter (as indeed cl 2.2 of the General Terms indicates CMS would normally do) but the evident purpose of the provisions relied on by Mr Harvey is precisely to avoid any argument as to whether further work carried out by CMS for the same clients is covered by the existing retainer letter or not. The effect of the provisions is that when a client asks CMS to carry out further work, it does not matter whether this is technically covered by the original retainer, or constitutes a variation of that retainer, or is a separate retainer for a new matter; whichever it is, the same terms are to apply unless expressly agreed otherwise. The good sense of this is manifest, especially as in practice the scope of the work a firm of solicitors provides to a client often evolves and changes to meet new problems, and it is frequently difficult to say whether this constitutes a new retainer or not.
- For these reasons, again without purporting to decide the point finally, I consider that it is at any rate highly probable that Mr Harvey is right. Assuming that the initial scope of the Retainer Letter was limited to the receivership, the continuing retainer of CMS by Mr Hamilton-Smith and Mr Wastell after their appointment as liquidators was (very probably) either a variation of the initial retainer (to which cl 3.1 of the General Terms applied) or a new matter on which they retained CMS (to which cll 2.1, 2.2 and 33.1 of the General Terms and the second paragraph of the Retainer Letter applied). In either case, the General Terms, including the exclusive jurisdiction clause in cl 30.1, would have applied.
Liquidator tort claims
- It follows, for the reasons I have given above at [22]-[25], that it is also highly probable that the exclusive jurisdiction clause would apply to the liquidator tort claims.
Conclusion on applicability of exclusive jurisdiction clause
- I conclude therefore that it is highly probable that all the claims brought by the Claimants in the Antiguan proceedings against CMS are covered by the exclusive jurisdiction clause. In these circumstances it is not necessary to consider two alternative arguments (Grounds 3 and 4) which Mr Harvey relied on; nor a fallback submission that if the applicability of the exclusive jurisdiction clause was doubtful, this could and should be determined as a preliminary issue.
- It follows that the bringing of the Claimants' claims against CMS in Antigua is (very probably) a breach of contract, and the continued prosecution of them will (very probably) be a further breach. It is apparent from Donohue v Armco (and accepted by Mrs Talbot Rice) that if so, CMS will be entitled to claim damages for breach of contract (if they can prove they have suffered any). The remaining question is whether they should also be granted an injunction to restrain the continuing breach, or should be left to their claim for damages.
Have the Claimants shown strong reasons for refusing the injunction?
- Mrs Talbot Rice says that there are strong reasons why the Claimants' claim against CMS should be permitted to proceed in Antigua. She recognises that it is a matter for the Antiguan Court, not for this Court, to decide whether to give permission to serve that claim out of the jurisdiction but says that the English Court should leave it to the Antiguan Court to decide. If the Antiguan Court does take jurisdiction, then that is the most appropriate forum for the claims to be heard in. She relies on two aspects in particular: (i) the litigation as a whole is completely Antiguan; and (ii) there is a serious risk of injustice if the claims are heard in England.
- So far as the proceedings being "completely Antiguan" are concerned, I think one needs to be a little bit careful. No doubt the SIB claim is Antiguan through and through. It is a claim brought by an Antiguan company against its former office-holders, appointed in accordance with Antiguan insolvency processes, in respect of their conduct of its affairs while they were in charge of it. The duties they owed to SIB as its receiver-managers or liquidators, and the question whether they were in breach of those duties, are, one would have thought, undeniably matters of Antiguan law. The claim has unsurprisingly been brought in Antigua and will be heard in Antigua whatever the outcome of this application.
- It is not so obvious that the same can be said of the claims brought by the Claimants against CMS. They are claims brought by English insolvency practitioners against English solicitors practising in London. On the view I have taken, all the claims are subject to the exclusive jurisdiction clause, and the same clause expressly provides that the retainer is governed by English law. On that assumption therefore, it means that even though the Claimants retained CMS in relation to their appointment as office-holders to an Antiguan company, and even though it appears that CMS's personnel were very largely working from offices in Antigua during the relevant period and giving advice as to what should be done in relation to the affairs of an Antiguan company subject to Antiguan insolvency processes, the question of what duties were owed by CMS to the Claimants under the retainer(s), and whether they were in breach of such duties, are matters of English not Antiguan law and on the face of it questions that the English Court is well placed to decide. It seems likely, although I should add that I was not specifically addressed on this, that English law would also apply to the tort claims, at any rate if the claim was heard in England: see art 4.2, 4.3 of the Rome II Regulation (No 864/2007 on the law applicable to non-contractual obligations).
- On the other hand the claims by the Claimants against CMS are almost wholly "parasitic", as Mr Hamilton-Smith puts it, on the claims made against them in the SIB claim. The Claimants' primary position is that they did nothing wrong, and among other things they wish to say in their defence that they acted on legal advice; their claims against CMS are claims over which they will pursue only if found to have acted wrongfully. (This may not be entirely true as the claims in the Antiguan action include claims to certain remuneration which the Claimants waived, and a claim for loss of future profits as joint liquidators, neither of which would appear to depend on their being found liable in the SIB action; but I proceed on the basis that at any rate the vast majority of the claim is purely reactive to the claim against them).
- That means that it is inevitable that the starting point for any determination whether CMS was in breach of its (English law) duties to the Claimants in relation to any particular aspect will be whether the Claimants were in breach of their (Antiguan law) duties to SIB in respect of that matter. To take a particular example, one of the complaints made in the SIB claim is that the Claimants implemented an online claims management system that is said by the current liquidators not to have been in compliance with the statutory rules governing submissions of liquidation claims under Antiguan law. As a result, one of the claims made by the Claimants against CMS in their Antiguan proceedings is that insofar as the claims process is found in the SIB claim not to have been legally compliant, CMS failed to advise the Claimants on the requisite framework for ensuring that it was compliant with the applicable laws and procedures. Now it is no doubt true that ultimately the question whether CMS were in breach of their retainer is a matter of English law; but it can be seen that one cannot begin to answer that question without first asking and answering the question whether the online claims process was compliant with Antiguan statutory requirements or not. (As it happens the Antiguan statutory requirements are in fact said to be based on the English Insolvency Rules, but this does not affect the principle.) This illustrates that the whole subject-matter of the Claimants' claim against CMS is the content and extent of the duties owed by the Claimants to SIB under Antiguan law.
- In this sense I agree that the Claimants' claims against CMS, even though very likely to be governed by English law, can indeed be characterised as Antiguan in character. It does not however follow from this alone that there is a strong reason to refuse the injunction and allow the Claimants' Antiguan claims to proceed: as Mr Harvey said, City solicitors frequently advise on matters with an international element, and the mere fact that the underlying transactions take place overseas and have a foreign character cannot by itself justify overriding an exclusive English jurisdiction clause.
- Mrs Talbot Rice's other point is that it really makes no sense, and is liable to lead to the risk of serious injustice, if the SIB claim proceeds in Antigua and the Claimants' claim over against CMS proceeds here, rather than both claims proceeding in Antigua. There is of course no guarantee that both claims can proceed in Antigua in any event, as that depends on whether the Antiguan Court gives permission to serve CMS out of the jurisdiction, but for the purpose of this exercise, it has to be assumed that the Antiguan Court is prepared to give such permission; if it is not, the Claimants will have to pursue their claims against CMS here if they are to pursue them at all.
- If one makes that assumption, Mrs Talbot Rice submitted that it is likely that the Antiguan Court would also direct that the SIB claim and the Claimants' claim against CMS be case managed together. I accept this submission. It would be a very inefficient use of the Court's and the parties' resources for the two actions to remain separate, as precisely the same issues would have to be gone over again in the second action. Antiguan procedure and practice is of course a matter for the Antiguan Court, and it is not for me to tell the Antiguan Court how to manage its own proceedings; but one can take comfort from the fact that, as already mentioned, the applicable rules of procedure in the Antiguan Court, which is part of the Eastern Caribbean Supreme Court, are modelled on English rules of procedure; I was also shown a decision of another part of the Eastern Caribbean Supreme Court, namely the Court of Appeal (hearing an appeal from Anguilla), on a procedural question (in fact concerning leave to serve out of the jurisdiction) which illustrates that that Court draws heavily on English jurisprudence: see Thornton Tomasetti Inc v Anguillan Development Corporation Ltd (15 September 2015). So it is not unrealistic to suppose that the Antiguan Court is likely to approach procedural questions in a similar way to that adopted by this Court; and I agree that on that supposition it is indeed likely that the two claims would be case managed and tried together, (or possibly one after the other with the evidence in the first also evidence in the second).
- On that assumption therefore the claims by SIB against the Claimants and the claims over by the Claimants against CMS are likely to be heard on the same disclosure, the same factual and expert evidence and the same legal arguments, and decided by the same judge.
- By contrast if the Claimants' claims against CMS proceed in England, Mrs Talbot Rice submits that there will be serious disadvantages to the Claimants. If the English proceedings are heard first, the Claimants will be in the unenviable position of having to allege their own wrongdoing (while simultaneously denying it in Antigua) in order to make out a case of negligence against CMS. They might not have, or be able to use, SIB's documents, and they would be unlikely to wish to call SIB's witnesses. They might not know the precise shape of the allegations made against them in Antigua which might subsequently be added to or changed. The English Court would have to reach conclusions on Antiguan law (as a matter of fact) before the Antiguan Court had ruled on the same issues of law. Taken together, she said, this would be to put them in an appallingly prejudicial position; it would be a case of the tail wagging the dog to hear a claim for what was in effect an indemnity before it had been decided whether there was anything to indemnify against.
- To some extent, as she recognised, that prejudice could be mitigated by staying the English proceedings until after the determination of the Antiguan proceedings; but that would not cure all the problems. Suppose the Antiguan proceedings were heard first and that the Antiguan Court found that the Claimants had been in breach of duty in certain respects. The Claimants would then prosecute their claims in England. CMS however, not having been parties to the Antiguan proceedings, would not be bound by the findings of fact in the Antiguan proceedings and the Claimants might have to go over the same material again. (In theory the English Court might not even be bound to come to the same conclusions on Antiguan law, although Mrs Talbot Rice accepted that it was perhaps unrealistic to imagine that the English Court would find as a fact that Antiguan law was different from what the Antiguan Court had already declared it to be as a matter of law.) The trial might very well take place on different documents and almost certainly take place on different oral evidence. There would be an inevitable duplication of costs and a real risk of the English Court coming to a different conclusion and hence of inconsistent judgments. For example the Antiguan Court might decide that the Claimants had acted wrongfully in some respect in which the Claimants had taken advice from CMS; the English Court might however take the view that the Claimants had in truth done nothing wrong so that no claim lay over against CMS.
- Mrs Talbot Rice referred me, by way of comparison, to Société Nationale Industriale Aerospatiale v Lee Kui Jak [1987] AC 871. There the widow, and the administrator of the estate, of a successful Brunei businessman killed in a helicopter crash in Brunei sued the manufacturer (SNIAS) in Texas, and SNIAS sought a contribution or indemnity from the operator (Bristow Malaysia). Bristow Malaysia was contesting the jurisdiction of the Texas Court, with the result that it was at least possible that SNIAS would have to claim against Bristow Malaysia in Brunei. If the plaintiffs' claim was allowed to proceed in Texas, it was therefore a "conceivable result" that SNIAS would be exposed to two sets of proceedings in which the same issue of liability would have to be tried, and so would be exposed to the danger of inconsistent conclusions on that issue, and hence might be held liable to the plaintiffs in Texas without any right over against Bristow Malaysia in Texas; they would therefore be in the unenviable position of having to claim over against Bristow Malaysia in Brunei in which they might have to establish their own liability to the plaintiffs, with all the difficulties that would involve including the possibility of inconsistent conclusions on liability. That was characterised by Lord Goff as something that could lead to serious injustice and that should properly be described as oppressive: see at 901E-G, 902D-F. I agree that that illustrates the practical difficulties that can arise where A sues B in one jurisdiction, and B has to claim over against C in separate proceedings in a different jurisdiction. It should however be pointed out that case did not concern an exclusive jurisdiction clause, and although an anti-suit injunction was granted to SNIAS against the plaintiffs restraining them from suing in Texas, that was on the basis of oppression which raises rather different considerations.
- I agree that the prospect for the Claimants of being sued by SIB in Antigua and having to claim over against CMS in England does give rise to real and unattractive consequences. But it can be seen that the persons potentially prejudiced by this are the Claimants themselves, and they are the ones who agreed, if they were going to sue CMS, that they would only sue them in England. That raises the question whether a person who has contractually agreed to an exclusive jurisdiction clause can rely on the disadvantages flowing to him from having to sue in the contractual jurisdiction as by themselves strong reasons for the Court to refuse an injunction. When I asked Mrs Talbot Rice what the answer was to that question, she referred me to the speech of Lord Bingham in Donohue v Armco, where he referred to the "interests of justice" and the "ends of justice" (at [34], [36] and [39]), and specifically to this passage at [34]:
"It seems to me plain that in a situation of this kind the interests of justice are best served by the submission of the whole dispute to a single tribunal which is best fitted to make a reliable, comprehensive judgement on all the matters in issue. A procedure which permitted the possibility of different conclusions by different tribunals, perhaps made on different evidence, would in my view run directly counter to the interests of justice."
- Lord Bingham's speech (with which Lords Mackay and Nicholls agreed, Lords Hobhouse and Scott agreeing in the result but giving their own reasons) must be read as a whole, and, as always, the statements of principle must be read against the particular facts of the case. The facts were that Mr Donohue and a number of other parties had been sued by 5 Armco companies in New York on a complaint alleging an "international fraud of immense proportions", the individual conspirators in the fraud being four former Armco executives, including Mr Donohue, a Mr Rossi and a Mr Stinson. (The fourth alleged conspirator, a Mr Atkins, had also been sued but the claim against him had been settled). Mr Donohue had the benefit of a contractual provision providing for the English Court to have exclusive jurisdiction but this only bound 3 of the 5 Armco companies, and in any event did not cover all the claims against him in New York; and Messrs Rossi and Stinson did not have the benefit of any such clause at all. The English Court therefore had no right to prevent the Armco companies from pursuing in New York (i) claims against Messrs Rossi and Stinson (and their companies), (ii) claims against Mr Donohue by the 2 Armco companies who were not bound by the clause; or (iii) claims falling outside the scope of the clause. Lord Bingham thought that everything suggested that these claims would take place in New York. He also thought that the essential question which lay at the heart of the dispute was whether the Armco companies had been the victims of a fraudulent conspiracy; that turned on the honesty and motives of the four alleged conspirators; and it would not seem conceivable that some were guilty and others not. It was in those circumstances that he said that the ends of justice would best be served by a single composite trial in the only forum in which a single composite trial could be procured, namely New York, and that that constituted strong reasons for not granting Mr Donohue an anti-suit injunction.
- When discussing the applicable principles Lord Bingham started at [24] with the statement that the English Court would ordinarily exercise its discretion to secure compliance with an exclusive jurisdiction clause unless the party suing in the non-contractual forum can show strong reasons for departing from it. He then continued at [25]:
"Where the dispute is between two contracting parties, A and B, and A sues B in a non-contractual forum, and A's claims fall within the scope of the exclusive jurisdiction clause in their contract, and the interests of other parties are not involved, effect will in all probability be given to the clause."
That statement of principle was followed by a number of authorities. At [26] he said that that was not an invariable result, but only one example was given, in which the dispute had a much closer connection with the non-contractual forum (England) than the contractual forum of Russia. At [27] he continued:
"The authorities show that the English Court may well decline to grant an injunction or a stay, as the case may be, where the interests of parties other than the parties bound by the exclusive jurisdiction clause are involved or grounds of claim not the subject of a clause are part of the relevant dispute so that there is a risk of parallel proceedings and inconsistent decisions."
He then gave a number of examples of that in which judges had referred to the undesirability of there being separate trials: Evans Marshall and Co Ltd v Bertola SA [1973] 1 WLR 349 ("the undesirability of there being two actions"); Aratra Potato Co Ltd v Egyptian Navigation Co [1981] 2 Ll Rep 119 ("a potential disaster from a legal point of view if [two actions were not tried together] because of the risk inherent in separate trials … that the same issues might be determined differently in the two countries"); Citi-March Ltd v Neptune Orient Lines Ltd [1996] 1 WLR 1367 ("the casualty…would become virtually untriable. The action would fragment and reduplicate, at vast cost"); Bouygues Offshore SA v Caspian Shipping Co [1998] 2 Ll Rep 461 ("the only way in which to minimize, if not avoid altogether, the risks of inconsistent decisions in different jurisdictions"). Those cases were to be contrasted with Crédit Suisse First Boston (Europe) Ltd v MLC (Bermuda) Ltd [1999] I Ll Rep 767 where Rix J granted an injunction in circumstances where it was not possible to make an order which would ensure trial of all proceedings arising out of all the agreements in one forum.
- I would I think have benefited from more exploration of the circumstances in which a person who had agreed to an exclusive jurisdiction clause could nevertheless resist the grant of an injunction restraining him from suing in a non-contractual forum on the grounds that it would cause him practical disadvantages. It seems clear that the interests of third parties not bound by the clause can be taken into account, and indeed the likely effect of an injunction on them may be "very material" (per Lord Bingham at [16]), but what I find far less clear on the material I was shown is whether, if the interests of third parties are not adversely affected, the "interests of justice" enable a Court to refuse an injunction so as to ensure that all disputes are heard in one forum where the only party who has an interest in that being done is the party who is bound by the clause. I will leave this question open for the moment and consider the interests of the relevant parties.
- There are only four parties whose interests appear to me to be likely to be affected by the grant or withholding of an injunction: SIB, the Claimants, CMS and Ogilvy. Leaving aside the position of the Claimants, which I will come back to, and taking the others in turn, SIB is not, so far as I can see, likely to be adversely affected by the grant of an injunction. Its claim lies against the Claimants, and this claim would appear to be quite unaffected by whether the Claimants have a claim over against CMS or not, or where and when that claim is tried, or the risk of inconsistent judgments. If anything, SIB might be prejudiced by refusing the injunction as the likelihood is that if the Claimants are able to bring CMS in as third parties to SIB's claim, the proceedings in Antigua will be more complex, longer and more expensive to try, quite apart from the fact that SIB might then find itself facing opposition not only from the Claimants but also from CMS.
- So far as CMS are concerned, they have decided that they would rather be sued in England than Antigua. That is a matter for them and that I think is that. In theory I can see that there might have been advantages to them in participating in the claim in Antigua and seeking to persuade the Antiguan Court either to come to factual findings or legal rulings favourable to the Claimants (and hence to them), rather than taking no part in that process. By not participating, CMS run the risk that the Antiguan Court finds for SIB in certain respects against the Claimants, leaving CMS if so advised to seek to persuade the English Court to come to a different view of the facts or the law. Although CMS would not be bound by the Antiguan proceedings, I suspect it is in the nature of things more difficult to persuade a court to reach a different view when another court has already made factual findings; and on questions of Antiguan law, I think CMS might find it difficult to persuade the English Court to depart from the law as expounded in Antigua. In this way if CMS were not there, they might find a point more or less concluded against them in Antigua without ever having an opportunity to make their own arguments against it. But whatever the potential advantages to them might have been, they have decided that they are outweighed by the disadvantages, and that is a judgment they are plainly entitled to reach for themselves.
- So far as Ogilvy is concerned, the position is more intricate. Mr Harvey's position was that CMS would wish to claim a contribution or indemnity from Ogilvy. Since some at least of the underlying complaints by SIB against the Claimants, and the Claimants' claims over against CMS, turn on what was done or not done in Canada, that is I think very understandable. Mr Harvey's position is that if CMS is sued in England, there is no obstacle to that being done. So far as jurisdiction is concerned, CMS would rely on CPR r 6.36 and Practice Direction 6B para 3.1(4) under which CMS could, with the permission of the Court, serve a Part 20 claim on Ogilvy seeking contribution on the grounds that Ogilvy was a "necessary or proper party to the claim or additional claim". So far as the substantive claim is concerned, Mr Harvey said that such a claim would be governed by English law since art 20 of the Rome II Regulation provides that where several debtors are liable to a creditor for the same claim, one debtor's right to claim compensation from other debtors is governed by the law applicable to that debtor's non-contractual obligation towards the creditor. (This assumes that CMS's liability in tort to the Claimants is governed by English law, something I have already said seems likely to be the case). Finally so far as limitation is concerned, the English law of contribution is that found in the Civil Liability (Contribution) Act 1978, for which there is a 2-year limitation period, running from the date on which the right to recover contribution accrues (s. 10 Limitation Act 1980) so no problem of limitation seems likely to arise.
- By contrast, said Mr Harvey, there is no equivalent provision in Antiguan law to PD 6B para 3.1(4) permitting service out of the jurisdiction of a third party claim, as rule 7.3 of the ECSC CPR contains nothing similar. That seems to me likely to be right: at any rate Mrs Talbot Rice did not seek to persuade me that it was wrong. She suggested however that if the Antiguan Court were willing to take jurisdiction over CMS, it would also be likely to take jurisdiction over Ogilvy. That she said had two consequences. First it would mean that if the Claimants' claim against CMS proceeded in Antigua, it was likely that its claim against Ogilvy would also proceed there, and again be heard together with the SIB claim. That would mean that the Antiguan Court could in one proceeding find which, if either, of CMS and Ogilvy, were to blame for any default by the Claimants, and apportion liability to the Claimants accordingly. Moreover, she said, if the Antiguan Court did take jurisdiction over both CMS and Ogilvy, rule 18.3 of the ECSC CPR would entitle CMS to claim contribution from Ogilvy by filing and serving a notice on Ogilvy. That would be in Ogilvy's interests rather than having to defend themselves in two jurisdictions.
- It does seem that she is likely to be right about the latter point on r 18.3, but I am not so confident of the former. I know very little about Ogilvy's position, beyond the inference (which I have already referred to), from the fact that the Claimants have had to apply in Antigua for permission to serve Ogilvy out of the jurisdiction, that Ogilvy has not submitted to the jurisdiction of the Antiguan Court. Since Ogilvy's advice was, so far as I can see from the pleadings, in relation to things done or not done in Canada, and pursuant to a retainer presumably governed by Canadian law, I think I must assume that there may be a real question whether the Antiguan Court will assume jurisdiction over Ogilvy; and that is so whether or not the Antiguan Court assumes jurisdiction over CMS.
- Moreover even if the Antiguan Court does assume jurisdiction over both CMS and Ogilvy, with the result that CMS could serve a notice under r 18.3 of the ECSC CPR, it does not follow that CMS would have in Antigua any substantive claim to contribution or an indemnity from Ogilvy. That would presumably depend on whether Antigua, under its rules of private international law, regarded such a claim as a matter for the law of the forum, and if so, whether Antiguan law confers such a right of contribution. On none of this do I have any evidence at all, and I do not think I should assume that Antiguan law does confer a right of contribution between co-defendants without any evidence that that is the case. Antiguan law is no doubt based on English common law principles, but contribution between defendants is in England statutory, and I have not been shown any Antiguan statutory provision comparable to the 1978 Act. Moreover, even if such a claim does lie in principle, I have no evidence as to what limitation period might apply to it.
- In these circumstances, it seems to me that I should proceed on the basis that there is a distinct possibility that CMS will be unable to pursue its claim for a contribution against Ogilvy in Antigua, either because the Antiguan Court will not take jurisdiction over Ogilvy, or because even if it does no substantive claim lies or any such claim is affected by limitation. Mr Harvey's position however, as I have set out above, is that CMS's claim to contribution from Ogilvy if brought here is governed by English law, and specifically the 1978 Act. As such it seems to me that CMS would be able to seek permission from the English Court to bring a claim against Ogilvy under CPR 6.36 and Practice Direction 6B para 3.1(20). Para 3.1(20) has since 2008 provided that one of the jurisdictional gateways is where a claim is made:
"(a) under an enactment which allows proceedings to be brought and those proceedings are not covered by any of the other grounds referred to in this paragraph."
I was not addressed on this, but it does appear that that would cover a claim by CMS against Ogilvy for contribution under the 1978 Act, and in circumstances where such a claim could not be brought anywhere else, I would have thought that CMS would have a strong claim for being granted permission to serve out, provided of course it had a sufficient case on the merits.
- In these circumstances I am very far from confident that if I refuse the injunction it will bring about a situation in which all the disputes will be able to be heard in one forum. There is a real likelihood that CMS will have to, and will be able to, pursue any claim against Ogilvy for a contribution in England whether or not I grant the injunction. At any rate the Claimants, on whom the onus of showing strong reasons for refusing the injunction lies, have failed to demonstrate to my satisfaction that CMS will be able to litigate their claim against Ogilvy for a contribution in Antigua. That means that I am not persuaded that it is in Ogilvy's interests for me to refuse the injunction; had I been confident that to do so would ensure that all disputes would be heard in one jurisdiction, the matter would be different, but as it is, I find that Ogilvy may be facing claims in both jurisdictions whether I grant the injunction or not. If anything, allowing the Claimants to pursue CMS in Antigua might make it more likely that the Antiguan Court would also permit Ogilvy to be joined in those proceedings.
- For the reasons I have given I am not persuaded that it is in the interests of any of SIB, CMS or Ogilvy to allow the Claimants to proceed in Antigua. I come back therefore to the position of the Claimants. I have already said that having to sue CMS in England poses real disadvantages for them. But the Claimants are on the view I have taken bound (or very probably bound) by the exclusive jurisdiction clause and are, and will continue to be, in breach of contract by suing CMS in Antigua. In general a person who has contractually agreed not to do something cannot resist an injunction just because there are disadvantages to him in complying with his contract: see Skype Technologies v Joltid at [30] per Lewison J, referring to the classic approach in Doherty v Allman (1877-8) LR 3 App Cas 709 at 719-20 where Lord Cairns LC went so far as to say that in the case of a negative covenant, there is no discretion to exercise and there is then no question of the balance of convenience or inconvenience. As Lewison J said (at [31]), that simple approach is probably too simple, and the Court does have a real discretion to exercise but the starting point is the parties' contractual bargain; see also the reference at [40] to Joltid attempting to wriggle out of its contract. If someone has contracted not to sue elsewhere than in England, an injunction restraining him from doing so is doing no more than enforcing what he has promised to do. It is true, as referred to above, that if the Claimants are not restrained from suing in Antigua they will lay themselves open to a claim for damages for breach of contract, but I have some doubts whether that could be an adequate remedy.
- As Lewison J says (at [34]), one consideration which continues to play an important part in the exercise of the discretion to enforce an exclusive jurisdiction clause by injunction is whether the outcome of the decision will enable all disputes to take place in the same forum, allied to which is the question whether there are other parties involved in the same or closely related disputes, the reason underpinning these considerations being the understandable desire of the English Court to avoid parallel proceedings and the possibility of inconsistent decisions. But in that case, as in the Crédit Suisse case, he concluded that the goal of a single forum could not be achieved and that it therefore followed that:
"the existence of parallel proceedings and the possibility of inconsistent decisions cannot amount to a strong reason not to enforce the injunction."
I have come to the view that the same is true here. Whatever I decide on the injunction, I cannot ensure that all proceedings will take place in the same forum. On the contrary, as I have sought to explain, there is in my view a real prospect that proceedings between CMS and Ogilvy will have to be brought here.
- So the choice it seems to me is between granting an injunction upholding the contract which the Claimants entered into, in which case the Claimants will be in the admittedly unattractive position of having to defend themselves in Antigua, but claim over against CMS in England; or allowing the Claimants, in breach of contract, to pursue CMS in Antigua, which may well leave CMS having to defend themselves in Antigua, but claim over against Ogilvy in England. Put like that, I do not think the Claimants have demonstrated a strong reason why I should prefer their interests in being allowed to break their contract to CMS's interests in having it upheld. That means it is unnecessary to decide the point I left open earlier, namely whether, in a case where the interests of other parties are not adversely affected, the Court can and should have regard to the undesirability of parallel proceedings and the risk of inconsistent decisions as an end in itself. In this case it seems to me that I should decide the application for the injunction on the simple basis that whatever I do it has not been shown to my satisfaction that it will be possible for all disputes to be heard in a single forum, and in those circumstances the interests of CMS in upholding the contractual bargain deserve to be given greater weight than the interests of the Claimants in being allowed to break it.
- Mrs Talbot Rice also referred to the fact that CMS had sought, and obtained, an order from the Antiguan Court in respect of their fees. The relevant facts are as follows. The Claimants applied to the Antiguan Court for approval of their fees and disbursements incurred during their appointment as liquidators of SIB ("the Remuneration Proceedings"). That included CMS's fees. The current liquidators of SIB oppose the Remuneration Proceedings, among other grounds on the basis of the complaints which SIB has now also made in its claim against the Claimants. CMS became involved in the Remuneration Proceedings in an endeavour to get their fees paid directly by the current liquidators. On 25 September 2013 Wallbank J ordered the current liquidators to serve their points of dispute table on CMS, and directed that the issue of whether or not CMS was to be treated as a direct creditor of the SIB estate in respect of their fees and disbursements was to be tried as a preliminary issue. CMS then in fact successfully negotiated a settlement of their fees with the current liquidators, which included the payment of such fees directly by the current liquidators and the ability to prove as an expense creditor in SIB's liquidation if such payment was not made by a certain date. A consent order was made by Wallbank J on 30 April 2014 giving effect to that agreement. CMS are not named as a party to the proceedings in the title to that order, which only names Mr Hamilton-Smith and Mr Wastell as Applicants, and Mr Wide and Mr Dickson as joint liquidators of SIB as Respondents, but one of the recitals refers to the Court noting that CMS consented to the terms of the order, and the substantive order provides:
"the Respondents and CMS agree and this Court finds that it is proper and acceptable that the costs and disbursements claimed by CMS be assessed in the sum of £1,740,000…"
That consent order was signed on behalf of CMS by Mr Aldred, a partner in the firm.
- On these facts Mrs Talbot Rice submitted that CMS had effectively applied to the Antiguan Court to get their fees paid (fees due under the very retainer on which CMS now relies for their anti-suit injunction), thereby effectively submitting to the Antiguan Court, or at any rate that it does not lie in CMS's mouth to complain that the Claimants' claim is in breach of the exclusive jurisdiction clause when they have themselves already been to the Antiguan Court in a successful endeavour to obtain payment of their fees.
- Mr Harvey said that CMS had never become party to the Remuneration Proceedings. That may be strictly correct; but they did participate in the proceedings to the extent of signing a consent order giving effect to a negotiated settlement of their claim for fees, thereby taking advantage of the Court's jurisdiction to make such an order. For present purposes that seems to me to amount to a submission to the jurisdiction.
- Mr Harvey however also said that CMS had never submitted to the jurisdiction in relation to the current dispute. Here I think he is on stronger ground. It appears that CMS's participation in the Remuneration Proceedings was directed at what they were entitled to be paid, and whether they had a direct claim against the SIB estate. Those issues appear to have been issues between CMS on the one hand and the current liquidators on the other. I do not think that enshrining a settlement of those issues in a consent order amounts to a submission to the jurisdiction in relation to future disputes between the Claimants and CMS (which disputes, so far as I have been told, had not then been raised) so as to preclude them from relying on the exclusive jurisdiction clause; nor do I think it makes it unfair for them to do so, or amounts to a strong reason for refusing an injunction.
- I am therefore not satisfied that the Claimants have demonstrated the necessary strong reasons for refusing the grant of the anti-suit injunction asked for by CMS, and I will grant such an injunction.
Stay
- The Claimants have an application for a stay of these proceedings. As initially formulated, the Claimants sought a stay pending determination by the Antiguan Court of the question of jurisdiction over the Claimants' claims against CMS, with a view to the English proceedings remaining stayed if the Antiguan Court accepted jurisdiction. That was opposed by Mr Harvey on the ground that (i) the Court was prohibited under the recast Judgments Regulation (1215/2012/EU) from granting a stay on jurisdictional grounds; and (ii) that the Court should not circumvent that prohibition by granting a stay ostensibly on case management grounds if the objective was really to achieve a permanent stay so that proceedings could be continued in another jurisdiction.
- Mr Harvey developed these points and a number of interesting questions were argued such as whether arts 33 and 34 of the Judgments Regulation (which allow the English Court to stay proceedings where the same, or a related, claim is pending in a third State) applied at all where there was an exclusive jurisdiction clause conferring jurisdiction on the English Court. Mr Harvey said they did not as they are expressly limited to cases where jurisdiction is based on arts 4, 7, 8 or 9, whereas jurisdiction based on an exclusive jurisdiction clause is based on art 25; Mrs Talbot Rice said that as CMS was domiciled here, the English Court had jurisdiction under art 4 in any event, and hence arts 33 and 34 were applicable.
- It is not however necessary to decide these points. In the course of her argument, Mrs Talbot Rice made what was to my mind the compelling point that however interesting these questions were, they were all irrelevant, as the Claimants would not in fact ever need to ask for a permanent stay. If the injunction was refused, all she asked for was a temporary stay to enable the Court to wait and see if the Antiguan Court took jurisdiction; if it did, the Claimants would not need to ask for the stay to be made permanent as they could simply discontinue the proceedings. If however the injunction was granted, there would be no question of seeking a permanent stay, and all she would ask for was a temporary stay pending the outcome of the Antiguan claim. That would not be a stay on jurisdictional grounds, but on conventional case management grounds.
- As I have decided to grant the injunction, it is only the latter type of stay that is in issue. In principle I see the good sense of staying this claim, which I have already said I accept to be parasitic on SIB's claim against the Claimants, to await the outcome of those proceedings. In reply Mr Harvey, having taken instructions, said that CMS would agree in principle to a stay for 6 months in the first instance with a view to reviewing the claim in 6 months' time to see what if any progress had been made in the Antiguan proceedings
- It is therefore really common ground that having decided to grant the injunction I should stay these proceedings, the only remaining question being whether the stay should only be for 6 months in the first instance with a review at the end of that period, or whether I should now impose a rather longer stay to await the outcome of the Antiguan proceedings. Since however the suggestion of a stay for 6 months only emerged in the course of Mr Harvey's reply, Mrs Talbot Rice did not address it, and it seems to me in the circumstances that the most appropriate course is to indicate now that I am minded to stay these proceedings, but that I will hear counsel when judgment is handed down as to how long that stay should be for in the first instance, and on any other consequential matters.
