![]() |
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] [DONATE] | |||||||||
England and Wales High Court (Queen's Bench Division) Decisions |
||||||||||
PLEASE SUPPORT BAILII & FREE ACCESS TO LAW
To maintain its current level of service, BAILII urgently needs the support of its users.
Since you use the site, please consider making a donation to celebrate BAILII's 25 years of providing free access to law. No contribution is too small. If every visitor this month gives just £5, it will have a significant impact on BAILII's ability to continue providing this vital service.
Thank you for your support! | ||||||||||
You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Euromark Ltd v Smash Enterprises Pty Ltd [2013] EWHC 1627 (QB) (06 June 2013) URL: https://www.bailii.org/ew/cases/EWHC/QB/2013/1627.html Cite as: [2013] EWHC 1627 (QB) |
[New search] [View without highlighting] [Printable RTF version] [Help]
QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL |
||
B e f o r e :
____________________
EUROMARK LIMITED |
Claimant |
|
- and - |
||
SMASH ENTERPRISES PTY LTD |
Defendant |
____________________
Anthony White QC (instructed by Reed Smith LLP) for the Defendant
Hearing date: 6 June 2013
____________________
Crown Copyright ©
The Hon. Mr. Justice Coulson:
1. INTRODUCTION
2. THE AGREEMENT
"This Agreement and the relationship between the parties shall be governed by and in accordance with Australian law and the parties hereby submit to the exclusive jurisdiction of the courts of Australia."
3. SUBSEQUENT EVENTS
4. THE ISSUES
(a) Does the claim fall within one of the jurisdictional gateways at paragraph 3.1 of 6BPD?
(b) Does the claimant have a reasonable prospect of success (CPR Rule 37 (1)(b))?
(c) Is the court satisfied that England is the proper place in which to bring the claim (CPR Rule 37 (3))?
(a) Issue 1: Are the reasons advanced before Master Yoxall, to explain why the exclusive jurisdiction clause should not be enforced, sustainable (Section 6 below)?
(b) Issue 2: If not, is there some other strong reason why the exclusive jurisdiction clause should not be enforced (Section 7 below)?
5. THE LAW
1. "Strong Reasons"
"If contracting parties agree to give a particular court exclusive jurisdiction to rule on claims between those parties, and a claim falling within the scope of the Agreement is made in proceedings in a forum other than that which the parties have agreed, the English court will ordinarily exercise its discretion (whether by granting a stay of proceedings in England, or by restraining the prosecution of proceedings in the non-contractual forum abroad, or by such other procedural order as is appropriate in the circumstances) to secure compliance with the contractual bargain, unless the party suing in the non-contractual forum (the burden being on him) can show strong reasons for suing in that forum. I use the word "ordinarily" to recognise that where an exercise of discretion is called for there can be no absolute or inflexible rule governing that exercise, and also that a party may lose his claim to equitable relief by dilatoriness or other unconscionable conduct."
At paragraph 25 he went on to say:
"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."
2. Foreseeable Questions of Convenience
"Such overwhelming or very strong reasons do not include factors of convenience that were foreseeable at the time that the contract was entered into (save in exceptional circumstances involving the interests of justice); and it is not appropriate to embark upon a standard Spiliada balancing exercise. The defendant has to point to some factor which it could not have foreseen at the time the contract was concluded. Even if there is an unforeseeable factor or a party can point to some other reason which, in the interests of justice, points to another forum, this does not automatically lead to the conclusion that the court should exercise its discretion to release a party from its contractual bargain…"
3. Interests of Justice
"In the nature of things for the court to exercise its jurisdiction so as not to give effect to an EJC the strong reason relied on must ordinarily go beyond a mere matter of foreseeable convenience, and extend either to some unforeseeable matter of convenience, or enter into the interests of justice itself. Even then, it cannot simply be assumed that the court will automatically exercise its discretion so as to release one party from its contractual bargain. Once the interests of justice are engaged, then factors of convenience will be relevant to the exercise by the court, of its discretion."
6. ISSUE 1: ARE THE REASONS ADVANCED BEFORE MASTER YOXALL, TO EXPLAIN WHY THE EXCLUSIVE JURISDICTION CLAUSE SHOULD NOT BE ENFORCED, SUSTAINABLE?
"The jurisdiction clause does not say where disputes about the validity of the contract are to be determined, if this is not to be in the forum which is expressly mentioned. The default position is that such claims would have to be brought in the jurisdiction where their opponents were incorporated, wherever and however unreliable that might be, while claims for breach of contract have to be brought in England. But why, it may be asked, would any sensible businessmen have wished to agree to this? As Bingham LJ said in Ashville Investments Ltd v Elmer Contractors Ltd [1989] QB 488, 517, one should be slow to attribute to reasonable parties an intention that there should in any foreseeable eventuality be two sets of proceedings. If the parties have confidence in their chosen jurisdiction for one purpose, why should they not have confidence in it for the other? Why, having chosen their jurisdiction for one purpose, should they leave the question which court is to have jurisdiction for the other purpose unspoken, with all the risks that this may give rise to? For them, everything is to be gained by avoiding litigation in two different jurisdictions. The same approach applies to the arbitration clause."
7. ISSUE 2: IS THERE SOME OTHER STRONG REASON WHY THE EXCLUSIVE JURISDICTION CLAUSE SHOULD NOT BE ENFORCED?
1. General
2. The Defendant's Conduct
(a) The defendant appeared to realise in September/October 2012 that they could cut out the claimant middle man and deal directly with their retailers, and that this would enhance their profits.
(b) The defendant wrongly assumed that it could (or would be able to) terminate the Distribution Agreement at will, and thus got itself into a legal muddle when it realised that it could not.
(c) The allegations now made by the defendant against the claimant in order to justify termination maybe arguable, but do not appear to me, on first impression, to be very strong. They were advanced in a pretty ramshackle fashion in the correspondence.
(d) On the other hand, the claimant's case against the defendant for repudiation appears strong, although, I express no view about the issue as to the alleged subsequent affirmation by the claimant.
3. The Damaging Impact on the Claimant
4. Difficulties of Litigating in Australia
5. Procedural Advantage
6. Summary