Service of proceedings outside the jurisdiction

A Defendant may be sued in the Court of England and Wales only if the Court grants permission to serve the proceedings outside the jurisdiction. In this regard, permission will only be granted if the Courts of England and Wales are found to be the most appropriate forum in which to hear the claim.

At first instance, the English Courts have seemingly been willing to accept jurisdiction over claims involving accidents which occurred in a foreign country. For example, in the case of Stylianou v Toyoshima & Suncorp [2013] a British Claimant was injured in a road traffic accident which had occurred in Western Australia. The First Defendant, the driver, who was acknowledged to be at fault, was Japanese. The Second Defendant, his insurer, was Australian. The Claimant had issued proceedings in Australia and these had reached an advanced stage. However, she subsequently issued proceedings in the English High Court and sought permission to serve the Defendant out of the jurisdiction. The permission was granted and the Second Defendant applied to set the Order aside on the basis that the Claimant was ‘forum shopping’ in order to bring herself within the jurisdiction most advantageous to her.

The Court dismissed the application on the basis that as the only issue in dispute between the Parties related to quantum, and that all of the witnesses of fact and expert witnesses were situated in England, the determination of the value of the claim could most conveniently be dealt with within the English Courts.

However, in the case of Brownlie v Four Seasons Holdings Inc [2015] the Court of Appeal placed an important limitation on the acceptance of jurisdiction in cases of this nature.

In order for the claim to be brought in England the relevant part of the Civil Procedure Rules in force at the time (CPR Practice Direction 6B 3.1(9)) required damage to be sustained “within the jurisdiction”. Prior to Brownlie, the English Courts had seemingly had no difficulty in concluding that where a Claimant has required medical treatment and care within this jurisdiction, he or she had indeed sustained damage “within the jurisdiction”. For example, in the case of Cooley v Ramsey [2008] it was held that ‘damage’ could include indirect damage, so that when, for example, a Claimant had been injured abroad but then sustained a loss of earnings within England and Wales, the Court could take jurisdiction over the claim.

The decision in Brownlie essentially overturned these decisions and found that for a personal injury claim to be brought within the jurisdiction of England and Wales it was necessary for ‘direct’ damage (i.e. physical injury) to have been sustained within the jurisdiction. As a result, the decision of the Court of Appeal essentially meant that in cases where losses had occurred as a result of an accident overseas, the Courts in England and Wales would no longer have jurisdiction (no ‘direct’ damage having been sustained here).

However, on 1^st October 2015 (and seemingly without very much at all in terms of publicity) the 81^st update to the Civil Procedure Rules took effect, which, it seems to me, has had the effect of overturning the Court of Appeal decision in Brownlie and returning the position to the line of authority developed by the Courts at first instance.

 

Specifically, the update included a small but seemingly significant amendment to Practice Direction 6B which governs the ‘gateways’ for service outside the jurisdiction. In this regard, the relevant Practice Direction has been amended so that it now reads ‘damage was sustained, or will be sustained, within the jurisdiction”.

It strikes me that the addition of these 4 words highlighted above has significantly expanded the relevant jurisdictional gateway and overturns the Court of Appeal decision in Brownlie in that it is now sufficient for ‘indirect’ damage to be sustained ‘within the jurisdiction’ for the purposes of satisfying the relevant Practice Direction.

To date, there appears to have been very little written in the legal press about this amendment but the implications for UK based Claimant’s injured as a result of an accident overseas are potentially very significant indeed.

For example, if the accident occurred prior to the entry into force of ‘Rome II’ (11^th January 2009) and the pre-Rome II regime therefore applies in respect of choice of applicable law, it is entirely plausible that the value of the claim will be assessed in accordance with principles of English law rather than the law of the country in which the accident actually occurred.

This could well result in significantly higher damages (certainly in more substantial cases) being recovered for a UK based Claimant than would otherwise have been the case.

Of course, it remains to be seen how the amendment to the relevant Practice Direction will be applied by the Courts but it is difficult to see how this could be interpreted in any other way than entitling the Courts to grant permission to serve proceedings outside of the jurisdiction where some degree of ‘indirect’ damage or loss either has been sustained or will be sustained here in the future.