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England and Wales High Court (Queen's Bench Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Alli-Balogun & On The Beach Ltd & Ors [2021] EWHC 83 (QB) (20 January 2021) URL: http://www.bailii.org/ew/cases/EWHC/QB/2021/83.html Cite as: [2021] EWHC 83 (QB) |
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL |
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B e f o r e :
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GABRIELLE ALLI-BALOGUN (suing by her mother and litigation friend OBIAGELI ALLI-BALOGUN |
Claimant |
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and |
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ON THE BEACH LIMITED ZURICH INSURANCE PLC SUCURSAL EN ESPANA HOSA HOTELS SA INSTITUT DE BALEAR D'EMERGEMCIES SL MAPFRE ESPANA COMPANIA DE SEGUROS Y REASEGUROS |
Defendants |
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and |
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MEETING POINT YOUTRAVEL TOURISM LLC |
Additional Party |
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Howard Stevens QC (instructed by MB Law) for the Additional Party
Hearing dates: 9 December 2020
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Crown Copyright ©
The Honourable Mr Justice Bourne:
Introduction
Factual background
"This agreement is governed by the laws of England and Wales and both parties hereby agree to submit to the exclusive jurisdiction of the courts of England and Wales."
"5) CONFLICT WITH THE AGREEMENT.
[Meeting Point] and [OTB] agree that this DEED amends the terms of [the main contract], which shall remain effective, to the extent that it has not been amended by this DEED. In the event that there is a conflict between the terms of [the main contract] and the terms of this DEED, the terms of this DEED shall prevail. The terms of this DEED shall survive the termination of [the main contract], but only in respect of bookings made pursuant to [the main contract].
…
7) GOVERNING LAW AND JURISDICTION.
This DEED OF INDEMNITY and any disputes arising out of or in conjunction with its terms shall be governed by and construed in accordance with the laws of England and Wales."
i) Youtravel was incorporated in 2006. It has always been wholly owned by an English company known as Stelow Ltd. Stelow is a subsidiary of FTI, which acquired the majority shares in Stelow in May 2012. Youtravel traded as a supplier of holiday accommodation.ii) In 2014 there was a restructure. The business activities of Youtravel were transferred to a newly formed company incorporated in Dubai, namely Meeting Point.
iii) Youtravel, according to Ms Baumann Ximenes, thereupon changed its activities to those of a service company.
iv) According to Ms Baumann Ximenes, the shares in Meeting Point are held by individuals on trust for another German company, Meeting Point International GmbH, which in turn is a wholly owned subsidiary of FTI.
v) I note also that a Mr Dietmar Gunz is described by Ms Baumann Ximenes as the sole director of Youtravel, the sole director of Stelow and the CEO of FTI.
The applications and the CPR
"(1) A claim form may…be served by any of the following methods –
…
(c) leaving it at a place specified in rule 6.7, 6.8, 6.9 or 6.10; …
…
(e) any method authorised by the court under rule 6.15.
(2) A company may be served –
(a) by any method permitted under this Part; …"
"(1) The court may, on application, permit a claim form relating to a contract to be served on the defendant's agent where –
(a) the defendant is out of the jurisdiction;
(b) the contract to which the claim relates was entered into within the jurisdiction with or through the defendant's agent; and
(c) at the time of the application either the agent's authority has not been terminated or the agent is still in business relations with the defendant.
…
(5) This rule does not exclude the court's power under rule 6.15 (service by an alternative method or at an alternative place)."
"(1) Where it appears to the court that there is a good reason to authorise service by a method or at a place not otherwise permitted by this Part, the court may make an order permitting service by an alternative method or at an alternative place.
(2) On an application under this rule, the court may order that steps already taken to bring the claim form to the attention of the defendant by an alternative method or at an alternative place is good service…"
"In any proceedings to which rule 6.32 or 6.33 does not apply, the claimant may serve a claim form out of the jurisdiction with the permission of the court if any of the grounds set out in paragraph 3.1 of Practice Direction 6B apply."
And paragraph 3.1 of Practice Direction 6B provides:
"The claimant may serve a claim form out of the jurisdiction with the permission of the court under rule 6.36 where –
General Grounds
….
(4) A claim is an additional claim under Part 20 and the person to be served is a necessary or proper party to the claim or additional claim….
Claims in relation to contracts
(6) A claim is made in respect of a contract where the contract –
(a) was made within the jurisdiction;
(b) was made by or through an agent trading or residing within the jurisdiction;
(c) is governed by English law; or
(d) contains a term to the effect that the court shall have jurisdiction to determine any claim in respect of the contract…".
"(1) The court may dispense with service of a claim form in exceptional circumstances.
(2) An application for an order to dispense with service may be made at any time and –
(a) must be supported by evidence;
(b) may be made without notice."
Legal principles
"In relation to trading corporations, we derive the three following propositions from consideration of the many authorities cited to us relating to the "presence" of an overseas corporation:—
(1) The English court will he likely to treat a trading corporation incorporated under the law of one country ("an overseas corporation") as present within the jurisdiction of the courts of another country only if either
(i) it has established and maintained at its own expense (whether as owner or lessee) a fixed place of business of its own in the other country and for more than a minimal period of time has carried on its own business at or from such premises by its servants or agents (a "branch office" case), OR
(ii) a representative of the overseas corporation has for more than a minimal period of time been carrying on the overseas corporation's business in the other country at or from some fixed place of business.
(2) In either of these two cases presence can only be established if it can fairly be said that the overseas corporation^ business (whether or not together with the representative's own business) has been transacted at or from the fixed place of business. In the first case, this condition is likely to present few problems. In the second, the question whether the representative has been carrying on the overseas corporation's business or has been doing no more than carry on his own business will necessitate an investigation of the functions which he has been performing and all aspects of the relationship between him and the overseas corporation.
(3) In particular, but without prejudice to the generality of the foregoing, the following questions are likely to be relevant on such investigation:
(a) whether or not the fixed place of business from which the representative operates was originally acquired for the purpose of enabling him to act on behalf of the seas corporation;
(b) whether the overseas corporation has directly reimbursed him for (i) the cost of his accommodation at the fixed place of business; (ii) the cost of his staff;
(c) what other contributions (if any) the overseas corporation makes to the financing of the business carried on by the representative;
(d) whether the representative is remunerated by reference to transactions (e.g. by commission) or by fixed regular payments or in some other way;
(e) what degree of control the overseas corporation exercises over the running of the business conducted by the representative ;
(f) whether the representative reserves (i) part of his accommodation, (ii) part of his staff for conducting business related to the overseas corporation;
(g) whether the representative displays the overseas corporation's name at his premises or on his stationery, and if so, whether he does so in such a way as to indicate that he is a representative of the overseas corporation;
(h) what business (if any) the representative transacts as principal exclusively on his own behalf;
(i) whether the representative makes contracts with customers or other third parties in the name of the overseas corporation, or otherwise in such manner as to bind it;
(j) if so, whether the representative requires specific authority in advance before binding the overseas corporation to contractual obligations.
This list of questions is not exhaustive, and the answer to none of them is necessarily conclusive. If the learned judge (at p. 65G—H of his judgment) was intending to say that in any case, other than a branch office case, the presence of the overseas company can never be established unless the representative has authority to contract on behalf of and bind the principal, we would regard this proposition as too widely stated … Every case of this character is likely to involve "a nice examination of all the facts and inferences must be drawn from a number of facts adjusted together and contrasted" …
Nevertheless, we agree with the general principle stated thus by Pearson J,. in F. & K. Jabbur v. Custodian of Absentee Property for the State of Israel (1953) 2 L. Rep. 760 at p. 776:
'A corporation resides in a country if it carries on business there at a fixed place of business, and, in the case of an agency, the principal test to be applied in determining whether the corporation is carrying on business at the agency is to ascertain whether the agent has authority to enter into contracts on behalf of the corporation without submitting them to the corporation for approval.'
On the authorities, the presence or absence of such authority is clearly regarded as being of great importance one way or the other, A fortiori the fact that a representative, whether with or without prior approval, never makes contracts in the name of the overseas corporation or otherwise in such manner as to bind it must be a powerful factor pointing against the presence of the overseas corporation."
Meeting Point's application
"2.3 All agent and commission agreements, including amendments of the same, shall be negotiated and concluded exclusively by MPYT in Dubai. The Parties agree that Youtravel UK shall have no authority whatsoever to enter into or conclude any agreements on behalf of MPYT.
2.4 Without prejudice to clause 2.3 above, MPYT may request from time to time that Youtravel UK conducts discussions with local travel agents on commission rates and overrides. When conducting such discussions, Youtravel UK shall closely coordinate with MPYT who shall provide Youtravel UK with clear instructions and pricing guidelines in this regard and shall make the final decision in accordance with clause 2.3 above."
"3.3 Any significant customer complaints (i.e. those which could have a significant financial impact) shall be escalated to the COO of MPYT who will be responsible for deciding how to deal with the complaint.
…
3.7 YouTravel UK shall be authorized to settle complaints and personal injury cases on behalf of MPYT, however subject to Youtravel UK seeking MPYT's guidance and approval in relation to:
(a) all complaint cases which Youtravel UK is unable to settle by way of granting a [redacted in the hearing bundle]
(b) all personal injury cases which Youtravel UK is unable to settle within the financial limits defined by the deductibles pursuant to MPYT's liability insurance policy from time to time;
(c) any claims made by lawyers representing travel clients;
(d) a significant number of claims, i.e. claims pertaining to [redacted] ;
(e) claims related to the same reason which re-appear over a period of more than [redacted] ;
(f) any other significant (i.e. costly) or more complex issues"
OTB's application
"(1) The court may, on application, permit a claim form relating to a contract to be served on the defendant's agent where—
(a) the defendant is out of the jurisdiction;
(b) the contract to which the claim relates was entered into within the jurisdiction with or through the defendant's agent; and
(c) at the time of the application either the agent's authority has not been terminated or the agent is still in business relations with the defendant.
(2) An application under this rule—
(a) must be supported by evidence setting out—
(i) details of the contract and that it was entered into within the jurisdiction or through an agent who is within the jurisdiction;
(ii) that the principal for whom the agent is acting was, at the time the contract was entered into and is at the time of the application, out of the jurisdiction; and
(iii) why service out of the jurisdiction cannot be effected; and
(b) may be made without notice."
"It is evident from the advice that service of the proceedings at MPYTT's registered office address in Dubai would be disproportionately expensive and extremely time-consuming. The timetabling of the main claim will undoubtedly be affected, prejudicing the Claimant (a child who has suffered significant injuries). It is in the interests of all parties involved that any delay is kept to a minimum and avoided entirely if at all possible."
"General grounds
(4) A claim is an additional claim under Part 20 and the person to be served is a necessary or proper party to the claim or additional claim….
…
Claims in relation to contracts
(6) A claim is made in respect of a contract where the contract –
(a) was made within the jurisdiction;
(b) was made by or through an agent trading or residing within the jurisdiction;
(c) is governed by English law; or
(d) contains a term to the effect that the court shall have jurisdiction to determine any claim in respect of the contract…"
"(1) An application for permission under rule 6.36 must set out—
(a) which ground in paragraph 3.1 of Practice Direction 6B is relied on;
(b) that the claimant believes that the claim has a reasonable prospect of success; and
(c) the defendant's address or, if not known, in what place the defendant is, or is likely, to be found.
…
(3) The court will not give permission unless satisfied that England and Wales is the proper place in which to bring the claim.
…
(5) Where the court gives permission to serve a claim form out of the jurisdiction—
…
(b) it may—
(i) give directions about the method of service; …"
"The essentially relevant factors should, in the main at any rate, be capable of being identified relatively simply and, in many respects, uncontroversially. There is little point in going into much detail: when determining such applications, the court can only form preliminary views on most of the relevant legal issues and cannot be anything like certain about which issues and what evidence will eventuate if the matter proceeds to trial."
"It should be noted that a claimant may issue a claim form against a defendant who appears to be out of the jurisdiction, without first having obtained permission for service, provided that, if the case is not one where service may be effected without permission, the claim form is endorsed by the court "Not for service out of the Jurisdiction"."
"The mere fact that the defendant learned of the existence and content of the claim form cannot, without more, constitute a good reason to make an order under rule 6.15(2). On the other hand, the wording of the rule shows that it is a critical factor. As the editors of the 2013 edition of the White Book note (vol 1, para 6.15.5), rule 6.15(2) was designed to remedy what were thought to be defects as matters stood before 1 October 2008. The Court of Appeal had held in Elmes v Hygrade Food Products plc [2001] EWCA Civ 121 that the court had no jurisdiction to order retrospectively that an erroneous method of service already adopted should be allowed to stand as service by an alternative method permitted by the court. The editors of the White Book add that the particular significance of rule 6.15(2) is that it may enable a claimant to escape the serious consequences that would normally ensue where there has been mis-service and, not only has the period for service of the claim form fixed by CPR 7.5 run, but also the relevant limitation period has expired."
Conclusion