LUBBE AND OTHERS v CAPE PLC
HOUSE OF LORDS
[2000] 4 All ER 268, [2000] 1 WLR 1545, [2000] 2 Lloyd's Rep 383
HEARING-DATES: 19, 20, 21, 22 June, 20 July 2000
20 July 2000
CATCHWORDS:
Practice -- Stay of proceedings -- Jurisdiction -- South African plaintiffs
claiming damages in English actions against English company -- Claims for
personal injuries arising out of commercial activities in South Africa of South
African subsidiaries -- Actions raising substantial and complex issues
proceeding as group action -- Funding unavailable to plaintiffs in South Africa
-- Defendant applying to stay actions and undertaking to submit to South
African jurisdiction -- Real and substantial connection with South Africa --
Whether South African forum available to plaintiffs -- Whether public interest
relevant factor -- Whether actions to be stayed
HEADNOTE:
In 1997 in a number of actions begun in England the plaintiffs, who were almost
all South African citizens resident in South Africa, claimed damages for
personal injury, and in some cases death, against the defendant, a company
registered in England which owned a number of subsidiary companies in South
Africa engaged in the mining and processing of asbestos and the sale of
asbestos-related products. The plaintiffs alleged that, in respect of periods
before 1979, the defendant, while knowing of the injurious effect of exposure
to asbestos, had failed, as the parent company, to take appropriate steps to
ensure the adoption of proper working practices and safety precautions
throughout its subsidiary companies and had thereby acted in breach of a duty
of care it owed to employees of its subsidiary companies or to those living in
the area of their operations. The defendant, which had ceased to trade in
South Africa and had no assets there, sought to stay the first action and, on
the hearing of the application, undertook to submit to that jurisdiction. The
judge granted the stay, concluding that South Africa was the natural forum and
that justice did not require him to order otherwise. On the plaintiffs'
appeal, the Court of Appeal considered that the judge had failed to take into
account that the South African forum was unavailable to the plaintiffs until
the undertakings had been given and that its availability remained conditional
on their being fulfilled. The court concluded that the defendant had not shown
South Africa to be clearly the more appropriate forum and allowed the appeal.
Thereafter writs in nine further actions were issued by more than 3,000
plaintiffs, South African citizens resident in South Africa, who made similar
allegations against the defendant. Those cases were ordered to proceed as a
group action and the defendant applied for a stay of all the proceedings
against it. The judge, considering South Africa to be clearly the more
appropriate forum and rejecting the plaintiffs' objection that legal aid would
not be available to them there, concluded that there was no sufficient reason
to refuse a stay and granted the defendant's application. On the plaintiffs'
appeal the Court of Appeal, aware that legal aid had been withdrawn from
personal injury cases in South Africa, considered that the actions had their
most real and substantial connection there, that convenience and expense
pointed to that forum and that considerations of public interest supported that
conclusion. The court, expressing confidence that legal representation could
be made available there to the extent necessary to achieve proper consideration
of the plaintiffs' cases, dismissed their appeal.
On the defendant's appeal against the decision of the first Court of Appeal and
the plaintiffs' appeal against the decision of the second Court of Appeal:-
Held, (1) dismissing the defendant's appeal, that, where a plaintiff sued a
defendant as of right in the English court the defendant's application for a
stay on the ground of forum non conveniens could not succeed unless the court
was satisfied that there was another tribunal of competent jurisdiction in
which the case might be tried more suitably for the interests of all the
parties and for the ends of justice; that the defendant, in undertaking to
submit to the South African jurisdiction, had sufficiently satisfied the
requirement that the alternative forum was available and, since the
undertakings were before the judge when he considered the issue of forum non
conveniens, their timing was not a relevant factor for the first Court of
Appeal to have taken into account; but that, on the plaintiffs' case as then
presented, the first Court of Appeal's assessment of the balance between the
issues relating to the responsibility of the defendant parent company and the
personal injury claims was not shown to be unreasonable or wrong and it was
open to that court to conclude that South Africa was not clearly the more
appropriate forum (post, pp 1553H-1554A, 1556C-E, 1562B-E, 1565H-1566B, 1567D).
Sim v Robinow (1892) 19 R 665 applied.
(2) Allowing the plaintiffs' appeal, that, given the enhanced significance of
the personal injury issues after the institution of the nine further actions,
both the judge on the second stay application and the second Court of Appeal
had correctly regarded South Africa as clearly the more appropriate forum; but
that since the proceedings could only be handled efficiently, cost-effectively
and expeditiously on a group basis, since the preparation and conduct of the
personal injury issues, if the plaintiffs succeeded on the defendant's
responsibility issue, was a heavy and difficult task requiring the services or
supervision of professional lawyers and the obtaining of expert advice and
evidence, and since no convincing evidence suggested the availability of
appropriate funding in South Africa, whether by legal aid, contingency fee
arrangements or otherwise, the probable effect of a stay would be to deprive
the plaintiffs of the means of obtaining the representation and evidence
essential to the just disposal of their claims, and in consequence would amount
to a denial of justice; and that, accordingly, in the unusual circumstances of
the proceedings, lack of means in South Africa to prosecute the claims required
the stay to be refused (post, pp 1556F-H, 1557E, G-H, 1558E-F, 1559C-G,
1562B-E, 1567D).
Spiliada Maritime Corporation v Cansulex Ltd [1987] AC 460, HL(E) and Connelly
v RTZ Corporation Plc [1998] AC 854, HL(E) applied.
(3) That the principles applied by the court on an application for a stay on
the ground of forum non conveniens required it to exercise jurisdiction where a
plaintiff sued the defendant as of right in England unless it was satisfied
that the case might be tried in the other forum more suitably for the interests
of all the parties and the ends of justice; and that, accordingly,
considerations of public interest and public policy which did not relate to the
private interests of any of the parties and to securing the ends of justice in
the particular case should be left out of account in determining the
application (post, pp 1561E-G, 1566C-D, F-1567D).
Decision of the Court of Appeal [1998] CLC 1559 affirmed.
Decision of the Court of Appeal [2000] 1 Lloyd's Rep 139 reversed.
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500, CA; [1998] AC 854; [1997] 3 WLR 373; [1997] 4 All ER 335, HL(E)
Harrods (Buenos Aires) Ltd, In re [1992] Ch 72; [1991] 3 WLR 397; [1991] 4 All
ER 334, CA
Holtby v Brigham
& Cowan (Hull) Ltd [2000] 3 All ER 421, CA
MacShannon v Rockware Glass Ltd [1978] AC 795; [1978] 2 WLR 362; [1978] 1 All
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Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197
Piper Aircraft Co v Reyno (1981) 454 US 235
Sim v Robinow (1892) 19 R 665
Societe du Gaz de Paris v Societe Anonyme de Navigation
"Les Armateurs Francais," 1925 SC 332; 1926 SC (HL) 13, HL(Sc)
Spiliada Maritime Corporation v Cansulex Ltd [1987] AC 460; [1986] 3 WLR 972;
[1986] 3 All ER 843, HL(E)
Tulloch v Williams (1846) 8 D 657
Union Carbide Corporation Gas Plant Disaster at Bhopal, India in December 1984,
In re (1986) 634 F Supp 842; (1987) 809 F.2d 195
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& Brother Ltd [1993] 4 Med LR 1, CA
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929, CA
Agnew v Lansforsakringsbolagens AB [2000] 2 WLR 497; [2000] 1 All ER 737, HL(E)
Airbus Industrie GIE v Patel [1999] 1 AC 119; [1998] 2 WLR 686; [1998] 2 All ER
257, HL(E)
Amchem Products Inc v British Columbia (Workers' Compensation Board) (1993) 102
DLR (4th) 96
Amin Rasheed Shipping Corporation v Kuwait Insurance Co [1982] 1 WLR 961;
[1982] 1 Lloyd's Rep 638
Arkwright Mutual Insurance Co v Bryanston Insurance Co Ltd [1990] 2 QB 649;
[1990] 3 WLR 705; [1990] 2 All ER 335
Askin v ABSA Bank Ltd (unreported), 29 January 1999; Court of Appeal (Civil
Division) Transcript No 86 of 1999, CA
Atlantic Star, The [1974] AC 436; [1973] 2 WLR 795; [1973] 2 All ER 175, HL(E)
Banco Atlantico SA v British Bank of the Middle East [1990] 2 Lloyd's Rep 504,
CA
Berisford (S
& W) Plc v New Hampshire Insurance Co [1990] 2 QB 631; [1990] 3 WLR 688; [1990]
1 Lloyd's Rep 454
Berezovsky v Michaels [2000] 1 WLR 1004; [2000] 2 All ER 986, HL(E)
Bremer Vulkan Schiffbau und Maschinenfabrik v South India Shipping Corporation
Ltd [1981] AC 909; [1981] 2 WLR 141; [1981] 1 All ER 289, HL(E)
Bulmer (HP) Ltd v J Bollinger SA [1974] Ch 401; [1974] 3 WLR 202; [1974] 2 All
ER 1226, CA
Canea Catholic Church v Greece (1997) 27 EHRR 521
Caparo Industries Ltd v Dickman [1990] 2 AC 605; [1990] 2 WLR 358; [1990] 1 All
ER 568, HL(E)
Chapman v Chief Constable of South Yorkshire (1990) 134 SJ 726
Connelly v RTZ Corporation Plc (No 2), The Times, 12 July 1996, Court of Appeal
(Civil Division) Transcript No 590 of 1996, CA; [1998] AC 854, [1997] 3 WLR
373; [1997] 4 All ER 335, HL(E)
Connelly v RTZ Corporation Plc (No 3) (unreported), 4 December 1998, Wright J
Cardoba Shipping Co Ltd v National State Bank, Elizabeth, New Jersey [1984] 2
Lloyd's Rep 91, CA
Davies (Joseph Owen) v Eli Lilly
& Co [1987] 1 WLR 1136; [1987] 3 All ER 94, CA
Duijnstee v Goderbauer (Case 288/82) [1983] ECR 3663, ECJ
Durham v T
& N Plc (unreported), 1 May 1996; Court of Appeal (Civil Division) Transcript No
419 of 1996, CA
GKR Karate (UK) Ltd v Yorkshire Post Newspapers Ltd [2000] 2 All ER 931, CA
Gulf Oil Corporation v Gilbert (1947) 330 US 501
Hadmor Productions Ltd v Hamilton [1983] 1 AC 191; [1982] 2 WLR 322; [1982] 1
All ER 1042, HL(E)
Haji-Ioannau v Frangos [1999] 2 Lloyd's Rep 337, CA
Hamed El Chiaty
& Co v Thomas Cook Group Ltd [1992] 2 Lloyd's Rep 399
Handelskwekerij GJ Bier BV v Mines de Potasse d'Alsace SA (Case 21/76) [1978]
QB 708; [1977] 3 WLR 479; [1976] ECR 1735, ECJ
Happy Fellow, The [1998] 1 Lloyd's Rep 13, CA
Heil v Rankin [2000] 2 WLR 1173; [2000] 3 All ER 138, CA
Hoffman v Blaski (1960) 363 US 335
Hunter v Chief Constable of the West Midlands Police [1982] AC 529; [1981] 3
WLR 906; [1981] 3 All ER 727, HL(E)
Islamic Arab Insurance Co v Saudi Egyptian American Reinsurance Co [1987] 1
Lloyd's Rep 315, CA
Kongress Agentur Hagen GmbH v Zeehaghe BV (Case 365/88) [1990] ECR I-1845, ECJ
Margereson v JW Roberts Ltd [1996] PIQR P154; [1996] PIQR P358, CA
Marinari v Lloyds Bank Plc (Case C-364/93) [1995] ECR I-2719, ECJ
Niderost-Huber v Switzerland (1997) 25 EHRR 709
North Central and South Central Metropolitan Substructure Councils of the
Durban Metropolitan Area, Ex parte, 1998 (1) SA 78 (LCC)
Owens Bank Ltd v Bracca (Case C-129/92) [1994] QB 509; [1994] 2 WLR 759; [1994]
1 All ER 336; [1994] ECR I-117, ECJ
Pafitis v Greece (1998) 27 EHRR 566
Practice Direction (Court of Appeal (Civil Division)) [1999] 1 WLR 1027; [1999]
2 All ER 490, CA
Reunion Europeenne SA v Spliethoff's Bevrachtingskantoor BV (Case C-51/97)
[1998] ECR I-6511, ECJ
Radakrishna Hospitality Service Private Ltd v EIH Ltd (unreported), 4 February
1999, Newman J
Richardson-Merrell Inc, In re (1982) 545 F Supp 1130; sub nom Dowling v
Richardson-Merrell Inc (1984) 727 F.2d 608
Rofa Sport Management AG v DHL International (UK) Ltd [1989] 1 WLR 902; [1989]
2 All ER 743, CA
Sanicentral GmbH v Collin (Case 25/79) [1979] ECR 3423, ECJ
Sarrio SA v Kuwait Investment Authority [1996] 1 Lloyd's Rep 650; [1997] 1
Lloyd's Rep 113, CA
Schertenleib v Traum (1978) 589 F.2d 1156
Slabbert v Herbst, 1981 (4) SA 257
Societe d'Informatique Service Realisation Organisation v Ampersand Software BV
(Case C-432/93) [1995] ECR I-2269, ECJ
Sithole v Thor Chemical Holdings Ltd (unreported), 31 July 1998, Garland J
Smith Kline
& French Laboratories Ltd v Bloch [1983] 1 WLR 730, [1983] 2 All ER 72, CA
Veneta Mineraria SpA v Carolina Collieries (Pty) Ltd, 1985 (3) SA 633
Xin Yang, The [1996] 2 Lloyds Rep 217
INTRODUCTION:
LUBBE AND OTHERS (RESPONDENTS) v CAPE PLC (APPELLANT)
APPEAL from the Court of Appeal.
This was an appeal by the defendant, Cape Plc, with leave of the Appeal
Committee of the House of Lords (Lord Browne-Wilkinson, Lord Hope of Craighead
and Lord Millett) given on 30 March 2000, and vacating the order of the Appeal
Committee (Lord Browne-Wilkinson, Lord Hope of Craighead and Lord Hutton) given
on 14 December 1998 refusing leave to appeal from the judgment of the Court of
Appeal (Evans, Millett and Auld LJJ) on 30 July 1998 allowing an appeal by the
plaintiffs, Schalk Willem Burger
Lubbe (suing as administrator of the estate of Rachel
Lubbe) and four others, from Mr Michel Kallipetis QC, sitting as a deputy judge of
the High Court who, on 12 January 1998, had granted a stay of their action
against the defendant.
The facts are stated in the opinion of Lord Bingham of Cornhill.
LUBBE AND OTHERS (APPELLANTS) v CAPE PLC (RESPONDENT) AND RELATED APPEALS
APPEAL from the Court of Appeal.
This was an appeal by the plaintiffs, Schalk Willem Burger
Lubbe (suing as administrator of the estate of Rachel
Lubbe) and four others, Pauline Nel (suing as administratrix of the estate of Jacobus
Nel), Hendrik Ismael Afrika and 1538 others, Elizabeth Cocks and six others,
Ramathabathe Mphahlele and 374 others, Abraham Alexander and 99 others, Cecilia
Beukes and 26 others, Frederick Van Wyk and 57 others, Fanani Bembe and 12
others, Bosole Abram Chidi and 127 others and Mokganyetji Lidah Angwadi and 851
others, with leave of the Appeal Committee of the House of Lords (Lord
Browne-Wilkinson, Lord Steyn and Lord Hope of Craighead) given on 7 February
2000, from the judgment of the Court of Appeal (Pill, Aldous and Tuckey LJJ)
given on 29 November 1999 dismissing their appeals from Buckley J, who on 30
July 1999 had stayed their actions against the defendant, Cape Plc.
The facts are stated in the opinion of Lord Bingham of Cornhill.
COUNSEL:
Michael Beloff QC, Lord Brennan QC, Graham Read and Nicholas Khan for the
plaintiffs; Brian Doctor QC, Charles Gibson, Richard Coleman and Alan Dashwood
for the defendant.
JUDGMENT-READ:
Their Lordships took time for consideration. 20 July.
PANEL: Lord Bingham of Cornhill, Lord Steyn, Lord Hoffmann, Lord Hope of Craighead,
Lord Hobhouse of Woodborough
JUDGMENTBY-1: LORD BINGHAM OF CORNHILL
JUDGMENT-1:
LORD BINGHAM OF CORNHILL: My Lords, the central issue between the plaintiffs
and the defendant in these interlocutory appeals is whether proceedings brought
by the plaintiffs against the defendant should be tried in this country or in
South Africa.
There are at present over 3,000 plaintiffs. Each of them claims damages in one
of the 11 writs issued against the defendant between February 1997 and July
1999. All the plaintiffs claim damages for personal injuries (and in some
cases death) allegedly suffered as the result of exposure to asbestos and its
related products in South Africa. In some cases the exposure is said to have
occurred in the course of the plaintiff's employment, in others as a result of
living in a contaminated area. The exposure is said to have taken place in
different places in South Africa and over varying, but sometimes lengthy,
periods of time, ending for claim purposes in 1979. One of the plaintiffs (Mrs
Pauline Nel, suing as personal representative of her deceased husband) is a
British citizen resident in England. All the others are South African citizens
resident in South Africa. Most of the plaintiffs are black and of modest
means. Instructions to sue have been given to English solicitors by more than
800 additional claimants.
The defendant is a public limited company. It was incorporated in England in
1893 under the name Cape Asbestos Company Ltd, principally to mine and process
asbestos and sell asbestos-related products. From shortly after 1893 until
1948 it operated a blue asbestos (or crocidolite) mine at Koegas and a mill at
Prieska, both in the Northern Cape Province. In 1925 the defendant acquired
the shares in two companies, both incorporated in 1916: these were Egnep Ltd
and Amosa Ltd, which operated a brown asbestos mine and mill at Penge in
Northern Transvaal. For practical purposes the head office of these companies
was in Cape Town. In 1940 a factory was opened at Benoni, near Johannesburg,
to manufacture asbestos products. It was owned by a wholly-owned subsidiary of
the defendant.
In 1948 the corporate structure of the defendant's group was changed. The mine
at Koegas and the mill at Prieska were transferred to a newly-formed South
African company, Cape Blue Mines (Pty) Ltd. The shares in Cape Blue Mines,
Egnep and Amosa were transferred to a newly-formed South African holding
company, Cape Asbestos South Africa (Pty) Ltd ("CASAP"). The offices of all these companies were in Johannesburg. All the shares in
CASAP were owned by the defendant. In 1979 CASAP sold its shares in Cape Blue
Mines, Egnep and Amosa to an unrelated third party buyer, which shortly
thereafter sold them on. The defendant continued to hold an interest in the
South African companies which operated out of the factory at Benoni until 1989
(although the factory had been closed earlier). Since then the defendant has
had no presence anywhere in South Africa, and when the first of the writs in
the current proceedings was served the defendant had no assets in South Africa.
Although originating in South Africa, the defendant's asbestos-related business
has not been confined to that country. From 1899 the defendant operated a
number of factories in England engaged in processing asbestos and manufacturing
asbestos products. A factory at Barking was run by the defendant from 1913
until 1962, and then by a wholly-owned subsidiary until the factory was closed
in 1968. Another subsidiary, incorporated in Italy, operated a factory in
Turin which made asbestos products from 1911 until 1968, with an intermission
during the war years.
Some of the claims made in these actions date back to times when the defendant
was itself operating in Northern Cape Province. But the central thrust of the
claims made by each of the plaintiffs is not against the defendant as the
employer of that plaintiff or as the occupier of the factory where that
plaintiff worked, or as the immediate source of the contamination in the area
where that plaintiff lived. Rather, the claim is made against the defendant as
a parent company which, knowing (so it is said) that exposure to asbestos was
gravely injurious to health, failed to take proper steps to ensure that proper
working practices were followed and proper safety precautions observed
throughout the group. In this way, it is alleged, the defendant breached a
duty of care which it owed to those working for its subsidiaries or living in
the area of their operations (with the result that the plaintiffs thereby
suffered personal injury and loss). Some 360 claims are made by personal
representatives of deceased victims.
As reformulated during the first Court of Appeal hearing the main issue raised
by the plaintiffs' claim was put in this way:
"Whether a parent company which is proved to exercise de facto control over the
operations of a (foreign) subsidiary and which knows, through its directors,
that those operations involve risks to the health of workers employed by the
subsidiary and/or persons in the vicinity of its factory or other business
premises, owes a duty of care to those workers and/or other persons in relation
to the control which it exercises over and the advice which it gives to the
subsidiary company?"
The first of the writs in these proceedings was issued by Mrs
Lubbe and four other plaintiffs on 14 February 1997 (and when she died the action
was continued by Mr
Lubbe as her personal representative). The defendant promptly applied to stay the
proceedings on the ground of forum non conveniens. This application came
before Mr Michel Kallipetis QC sitting as a deputy judge of the Queen's Bench
Division, who acceded to it. He sought to apply the principles authoritatively
laid down by this House in Spiliada Maritime Corporation v Cansulex Ltd [1987]
AC 460, and for reasons given in a lengthy and careful judgment dated 12
January 1998 he concluded that everything pointed towards South Africa as the
natural forum for the trial of the action and that there was no pressing
circumstance which would justify him in deciding that the interests of justice
required a trial in this country instead of the natural forum in South Africa.
The plaintiffs appealed and on 30 July 1998 the Court of Appeal (Evans, Millett
and Auld LJJ) allowed the appeal [1998] CLC 1559. Like the judge, the Court of
Appeal also sought to apply the principles in the Spiliada case. But it
reached a different conclusion, holding that the judge had failed to give
weight to the fact that the negligence alleged was against the defendant
company as opposed to those persons or companies responsible for running its
South African businesses from time to time, and that the judge had failed to
take account of the fact that the South African forum had been unavailable to
the plaintiffs until the defendant offered undertakings during the hearing
before the judge, the availability of the South African forum being conditional
upon those undertakings being fulfilled: see p 1573. Taking those matters into
account, the Court of Appeal ("the first Court of Appeal") held that the defendant did not show that South Africa was clearly and
distinctly the more appropriate forum. In fairness to the judge it should be
observed that the second of these points was not raised before him (it was
indeed raised by the first Court of Appeal itself) and he could not therefore
be reproached for failing to take it into account.
At that stage, therefore, the plaintiffs were at liberty to pursue their action
in England. Before either of these decisions the sole plaintiff resident in
England (Mrs Nel) had also issued proceedings as personal representative of her
husband, joining no other plaintiff. The defendant sought to challenge the
decision of the first Court of Appeal but leave to do so was refused by that
court and, following an oral hearing, by your Lordships' House on 14 December
1998.
After the refusal of leave by your Lordships in December 1998, writs were
issued by all the remaining plaintiffs in these proceedings. It is unnecessary
to summarise the detailed procedural steps which followed. It is enough to
note that the defendant applied to stay all the actions, including the
Lubbe action, on grounds of forum non conveniens and abuse of process, and
directions were given to consolidate the various proceedings (without prejudice
to the position of the
Lubbe plaintiffs) into a group action.
The defendant's summons to stay came before Buckley J who heard detailed
submissions and considered copious documentary material. He gave a full
judgment in writing [2000] 1 Lloyd's Rep 139, 141 on 30 July 1999. He
concluded that South Africa was clearly and distinctly the more appropriate
forum for trial of this group action and that there were no sufficient reasons
for nevertheless refusing a stay: see p 151. In reaching this last opinion he
considered and discounted a number of objections raised by the plaintiffs,
including the alleged unavailability of legal aid in South Africa. Of that
submission he said, at p 150:
"In all the circumstances, I cannot find that legal aid would not be granted, if
applied for in South Africa. I readily accept there may be difficulties and
some delay but that, at least in part, must flow from the claimant's decision
not to apply for legal aid in South Africa and to issue proceedings here, when,
as [the plaintiffs' solicitor] well knew, the defendant would contest
jurisdiction."
The judge accordingly ordered a stay of proceedings. He considered an argument
advanced by the defendant that the proceedings were an abuse. The basis of
this argument was that the solicitors representing the
Lubbe plaintiffs had misled the first Court of Appeal and the House of Lords by
failing to disclose their intention, if jurisdiction in England was established
in the
Lubbe case, to launch a multi-plaintiff group action, and also that the bringing of
a group action was oppressive and an abuse. The judge expressed criticism of
the solicitors representing the
Lubbe plaintiffs but stopped short of finding abuse of the process: see p 154. The
judge also considered an argument, advanced by the defendant, suggesting that
there were public interest grounds for concluding that the proceedings should
be tried in South Africa: the judge reached his decision independently of this
argument (see p 154), but considered that it reinforced his decision. He gave
both sides leave to appeal.
Thus the matter came before the Court of Appeal (Pill, Aldous and Tuckey LJJ,
"the second Court of Appeal") again [2000] 1 Lloyd's Rep 139, and in judgments given on 29 November 1999
the appeals were dismissed. Pill LJ described the factors pointing towards
South Africa as the more appropriate forum as
"overwhelming:" see p 160. The action had the most real and substantial connection with South
Africa and considerations of expense and convenience pointed strongly in that
direction: see p 161. The public interest considerations supported that
conclusion: see pp 161-162. He was not persuaded by the argument that the
South African High Court would be unable to handle these actions (see p 162),
and with reference to legal representation he said, at p 164:
"I have already referred to the high repute in which the South African courts
are held. There is also in South Africa a legal profession with high standards
and a tradition of public service, though I do not suggest that lawyers in
South Africa, any more than those anywhere else, can be expected to act on a
large scale without prospects of remuneration. While I would not be prepared
to apply the second stage of the Spiliada test, so as to permit English
litigation, even in the absence of evidence that legal representation will be
available, I am unable to conclude that in the circumstances it would not
become available for claims in South African courts. Moreover, given the
accessibility to the wealth of scientific, technical and medical evidence
available in this context, I am confident that it could be made available in a
South African court to the extent required to achieve a proper consideration of
the plaintiffs' cases. The action would by no means be novel or speculative."
Pill LJ was not prepared to strike out the proceedings as an abuse of process:
see pp 164-165. He recorded that the plaintiffs had not pursued their
contention that article 2 of the Brussels Convention on Jurisdiction and the
Enforcement of Judgments in Civil and Commercial Matters (1968) (Cmnd 7395)
deprived the English court of any discretion to stay an action brought against
a defendant domiciled here, since they did not wish the proceedings to be
delayed while a reference was made to the European Court of Justice: see pp
164-165. He considered that the bringing of the multi-plaintiff group action
entitled the Court of Appeal to reconsider the decision of the first Court of
Appeal in the
Lubbe action and to reach a different conclusion: see p 165. He dismissed the
appeal.
Aldous LJ agreed, while recording earlier reservations about the availability
of legal representation: see p 166. He also expressed strong criticism of the
solicitors representing the
Lubbe plaintiffs but agreed with Pill LJ that what had happened did not mean that
there was an abuse of process such that the group action and the
Lubbe action should be stayed: see p 167. Tuckey LJ also agreed: he deprecated the
acrimony caused by the
Lubbe solicitors' failure to inform the Court of Appeal and the House of Lords of
the plan to launch a group action and attached less weight than the first Court
of Appeal had done to the fact that the South African forum had only become
available because of the defendant's undertaking to submit: see p 168. The
second Court of Appeal refused leave to appeal, but leave was given by your
Lordships to the plaintiffs on 7 February 2000. On 30 March 2000 your
Lordships also vacated the earlier order refusing leave to appeal in the
Lubbe action and gave leave to the defendant to challenge the decision of the first
Court of Appeal.
Reference should be made, finally, to an action which is not directly involved
in these proceedings. On 3 October 1997 proceedings were issued by Vincenzina
Gisondi and three other plaintiffs against the defendant making claims on
grounds similar to those relied on by the plaintiffs in the proceedings before
the House. The significant difference is that these plaintiffs complain of
exposure to asbestos and asbestos products not in South Africa but in Italy.
Thus the plaintiffs are resident in a state which is a party to the Brussels
Convention and sue a defendant domiciled in England, another contracting state.
It has not been suggested that the English court could under the Convention
decline jurisdiction in favour of an Italian forum, and no application for a
stay has been made by the defendant in that case. There appears to be no
jurisdictional objection to the prosecution of that action here, and no
application has been made to strike out the claim as disclosing no cause of
action.
The applicable principles
Where a plaintiff sues a defendant as of right in the English court and the
defendant applies to stay the proceedings on grounds of forum non conveniens,
the principles to be applied by the English court in deciding that application
in any case not governed by article 2 of the Brussels Convention are not in
doubt. They derive from the judgment of Lord Kinnear in Sim v Robinow (1892)
19 R 665, 668 where he said:
"the plea can never be sustained unless the court is satisfied that there is
some other tribunal, having competent jurisdiction, in which the case may be
tried more suitably for the interests of all the parties and for the ends of
justice."
Thus it is the interest of all the parties, not those of the plaintiff only or
the defendant only, and the ends of justice as judged by the court on all the
facts of the case before it, which must control the decision of the court. In
the Spiliada case [1987] AC 460, 476 it was stated:
"The basic principle is that a stay will only be granted on the ground of forum
non conveniens where the court is satisfied that there is some other available
forum, having competent jurisdiction, which is the appropriate forum for the
trial of the action, ie in which the case may be tried more suitably for the
interests of all the parties and the ends of justice."
In applying this principle the court's first task is to consider whether the
defendant who seeks a stay is able to discharge the burden resting upon him not
just to show that England is not the natural or appropriate forum for the trial
but to establish that there is another available forum which is clearly or
distinctly more appropriate than the English forum. In this way, proper regard
is had to the fact that jurisdiction has been founded in England as of right:
see the Spiliada case, at p 477. At this first stage of the inquiry the court
will consider what factors there are which point in the direction of another
forum: see the Spiliada case [1987] AC 460, 477; Connelly v RTZ Corporation Plc
[1998] AC 854, 871. If the court concludes at that stage that there is no
other available forum which is clearly more appropriate for the trial of the
action, that is likely to be the end of the matter. But if the court concludes
at that stage that there is some other available forum which prima facie is
more appropriate for the trial of the action it will ordinarily grant a stay
unless the plaintiff can show that there are circumstances by reason of which
justice requires that a stay should nevertheless not be granted. In this
second stage the court will concentrate its attention not only on factors
connecting the proceedings with the foreign or the English forum (the Spiliada
case, at p 478; the Connelly case, at p 872) but on whether the plaintiff will
obtain justice in the foreign jurisdiction. The plaintiff will not ordinarily
discharge the burden lying upon him by showing that he will enjoy procedural
advantages, or a higher scale of damages or more generous rules of limitation
if he sues in England; generally speaking, the plaintiff must take a foreign
forum as he finds it, even if it is in some respects less advantageous to him
than the English forum (the Spiliada case, at p 482; the Connelly case, at p
872). It is only if the plaintiff can establish that substantial justice will
not be done in the appropriate forum that a stay will be refused (the Spiliada
case, at p 482; the Connelly case, at p 873).
This is not an easy condition for a plaintiff to satisfy, and it is not
necessarily enough to show that legal aid is available in this country but not
in the more appropriate foreign forum. Lord Goff of Chieveley said in the
Connelly case, at p 873:
"I therefore start from the position that, at least as a general rule, the court
will not refuse to grant a stay simply because the plaintiff has shown that no
financial assistance, for example in the form of legal aid, will be available
to him in the appropriate forum, whereas such financial assistance will be
available to him in England. Many smaller jurisdictions cannot afford a system
of legal aid. Suppose that the plaintiff has been injured in a motor accident
in such a country, and succeeds in establishing English jurisdiction on the
defendant by service on him in this country where the plaintiff is eligible for
legal aid, I cannot think that the absence of legal aid in the appropriate
jurisdiction would of itself justify the refusal of a stay on the ground of
forum non conveniens. In this connection it should not be forgotten that
financial assistance for litigation is not necessarily regarded as essential,
even in sophisticated legal systems. It was not widely available in this
country until 1949; and even since that date it has been only available for
persons with limited means. People above that limit may well lack the means to
litigate, which provides one reason for the recent legalisation of conditional
fee agreements. Even so, the availability of financial assistance in this
country, coupled with its non-availability in the appropriate forum, may
exceptionally be a relevant factor in this context. The question, however,
remains whether the plaintiff can establish that substantial justice will not
in the particular circumstances of the case be done if the plaintiff has to
proceed in the appropriate forum where no financial assistance is available."
In the Connelly case a majority of the House held that the case before it was
such an exceptional case. The nature and complexity of the case were such that
it could not be tried at all without the benefit of legal representation and
expert scientific assistance, available in this country but not in the more
appropriate forum, Namibia. That being so, the majority of the House concluded
that the Namibian forum was not one in which the case could be tried more
suitably for the interests of all the parties and for the ends of justice.
The present cases
The issues in the present cases fall into two segments. The first segment
concerns the responsibility of the defendant as a parent company for ensuring
the observance of proper standards of health and safety by its overseas
subsidiaries. Resolution of this issue will be likely to involve an inquiry
into what part the defendant played in controlling the operations of the group,
what its directors and employees knew or ought to have known, what action was
taken and not taken, whether the defendant owed a duty of care to employees of
group companies overseas and whether, if so, that duty was broken. Much of the
evidence material to this inquiry would, in the ordinary way, be documentary
and much of it would be found in the offices of the parent company, including
minutes of meetings, reports by directors and employees on visits overseas and
correspondence.
The second segment of the cases involves the personal injury issues relevant to
each individual: diagnosis, prognosis, causation (including the contribution
made to a plaintiff's condition by any sources of contamination for which the
defendant was not responsible) and special damage. Investigation of these
issues would necessarily involve the evidence and medical examination of each
plaintiff and an inquiry into the conditions in which that plaintiff worked or
lived and the period for which he did so. Where the claim is made on behalf of
a deceased person the inquiry would be essentially the same, although probably
more difficult.
In his review of the
Lubbe case, which was alone before him, Mr Kallipetis considered that the
convenience of trying the personal injury issues in South Africa outweighed any
benefit there might be in trying the parent company responsibility issue here.
That was in my opinion a tenable though not an inevitable conclusion on the
case as then presented. The two reasons given by the first Court of Appeal for
disturbing that exercise of judgment are not to my mind convincing. Mr
Kallipetis's judgment does not suggest that he overlooked the way in which the
plaintiffs put their case, although he did not express it very clearly (perhaps
because the pleading Was not very clear). The first Court of Appeal thought it
undermined the defendant's application for a stay that the South African forum
only became available as a result of the defendant's undertaking to submit, but
for reasons given by my noble and learned friend, Lord Hope of Craighead (with
which I fully agree) this was not a factor which should have weighed in the
balance either way. I would not accept the argument advanced by the plaintiffs
on this point. I question whether the first Court of Appeal was justified in
disturbing Mr Kallipetis's conclusion and substituting its own. But its own
assessment of the balance between the parent company responsibility issue and
the personal injury issues is not shown to be unreasonable or Wrong. On the
case as then presented there was room for the view that South Africa was not
shown to be a clearly more appropriate forum. This is a field in which
differing conclusions can be reached by different tribunals without either
being susceptible to legal challenge. The jurisdiction to stay is liable to be
perverted if parties litigate the issue at different levels of the judicial
hierarchy in the hope of persuading a higher court to strike a different
balance in the factors pointing for and against a foreign forum.
The emergence of over 3,000 new plaintiffs following the decision of the first
Court of Appeal had an obvious and significant effect on the balance of the
proceedings. While the parent company responsibility issue remained very much
what it had always been, the personal injury issues assumed very much greater
significance. To investigate, prepare and resolve these issues, in relation to
each of the plaintiffs, would plainly involve a careful, detailed and
cumbersome factual inquiry and, at least potentially, a very large body of
expert evidence. In this changed situation Buckley J, applying the first stage
of the Spiliada test, regarded South Africa as clearly the more appropriate
forum for trial of the group action and the second Court of Appeal agreed.
Both courts were in my view plainly correct. The enhanced significance of the
personal injury issues tipped the balance very clearly in favour of South
Africa at the first stage of the Spiliada exercise, and no effective criticism
has been made of that conclusion. The brunt of the plaintiffs' argument on
these appeals to the House has been directed not against the decisions of
Buckley J and the second Court of Appeal on the first stage of the Spiliada
test but against their conclusion that the plaintiffs had not shown that
substantial justice would not be done in the more appropriate South African
forum.
Funding
The plaintiffs submitted that legal aid in South Africa had been withdrawn for
personal injury claims, that there was no reasonable likelihood of any lawyer
or group of lawyers being able or willing to fund proceedings of this weight
and complexity under the contingency fee arrangements permitted in South Africa
since April 1999 and that there was no other available source of funding open
to the plaintiffs. These were, they argued, proceedings which could not be
effectively prosecuted without legal representation and adequate funding. To
stay proceedings in England, where legal representation and adequate funding
are available, in favour of the South African forum where they are not would
accordingly deny the plaintiffs any realistic prospect of pursuing their claims
to trial.
The defendant roundly challenged these assertions. Reliance was placed on the
facts that the plaintiffs had not applied for legal aid in South Africa before
its withdrawal and had made no determined effort to obtain funding in South
Africa. Even if legal aid was no longer available in South Africa, contingency
fee agreements were now permissible and it was unrealistic to suppose that
South African counsel and attorneys would be any less ready to act than English
counsel and solicitors if the claims were judged to have a reasonable prospect
of success. If contingency fee arrangements could not be made in South Africa
because South African counsel and attorneys did not judge the claims to have a
reasonable prospect of success, that did not involve a denial of justice to the
plaintiffs. In any event there were other potential sources of assistance
available to the plaintiffs in South Africa.
The material placed before the House (and the lower courts) relevant to these
issues is very extensive and cannot conveniently be summarised. The following
conclusions are in my opinion to be drawn from it.
(1) The proceedings as now constituted can only be handled efficiently,
cost-effectively and expeditiously on a group basis. It is impossible at this
stage to predict with accuracy what procedural directions might on that basis
be given in future (although the directions could only relate to the conduct of
proceedings in England). Obvious possibilities include the trial of a
preliminary issue on the parent company responsibility question and the trial
of selected lead cases to test the outcome in different factual situations. It
would be very highly desirable, if possible, to avoid determination of these
claims on a plaintiff by plaintiff basis.
(2) The plaintiffs' claims raise a serious legal issue concerning the duty of
the defendant as a parent company, and it would be necessary to decide whether
that duty was governed by English or South African law. If a duty were held to
exist, there would be a serious factual issue whether the defendant was in
breach of it. If the plaintiffs were successful on these questions, the
personal injury issues would have, even in the context of a group action, to be
investigated, prepared and quantified. This would be a heavy and difficult
task. It could only be done by, or under the supervision of, professional
lawyers. It would call for high quality expert advice and evidence, certainly
on medical and industrial issues, very possibly on other issues also. I see no
reason to question the judgment of a South African attorney instructed by the
defendant who swore:
"The magnitude and complexity of both the factual and legal issues will require
the application in South Africa of considerable financial resources and
manpower, if there is to be any reasonable prospect of addressing the
plaintiffs' allegations meaningfully."
It is significant that Professor Unterhalter, an independent expert approached
by the defendant, observed:
"Detailed expert evidence would be required on a number of aspects of the
matter. Without agreement between the parties as to how the issues might be
limited, I would venture no opinion as to the length and magnitude of this
litigation, save to say that it is likely to be drawn out and complex, and
would almost certainly come before the Supreme Court of Appeal in due course."
(3) A possibility must exist that the proceedings may culminate in settlement.
The plaintiffs confidently predict such an outcome if they succeed on the
parent company responsibility issue. But the defendant has given no indication
that the claims will not be fully contested. In the Spiliada case Staughton J
thought it right to decide the stay application on the assumption that there
would be a trial, and it would seem to me wrong in principle to reject a
submission that justice will not be done in a foreign forum on the basis of a
speculative assumption that, if a stay is granted, proceedings in the foreign
forum will culminate in a just settlement without the need for a trial.
(4) In a letter dated 20 September 1999 to Leigh Day
& Co representing some of the plaintiffs, the Legal Aid Board of South Africa
wrote:
"It will however be of interest to you to note that on 13 September 1999 the
Legal Aid Board resolved, because of the financial crisis faced by it, as per
the attached letter to the Minister of Justice, to exclude from the operation
of the legal aid scheme operated by the South African Legal Aid Board with
effect from 1 November 1999 funding in respect of personal injury claims and
all other claims sounding in the money."
Other material before the House makes plain that before this decision the Legal
Aid Board had experienced a period of extreme financial stringency. Despite
suggestions to the contrary there is no convincing evidence to suggest that
legal aid might be made available in South Africa to fund this potentially
protracted and expensive litigation. Written submissions on behalf of the
Republic of South Africa contain no hint that public funds might,
exceptionally, be made available to fund it.
(5) The South African Contingency Fees Act (No 66 of 1997) sanctioned a new
regime similar (although not identical) to that governing conditional fees in
this country. It enables counsel and attorneys to undertake work for
plaintiffs on the basis that if the claim is successful they will receive a fee
in excess of that ordinarily chargeable, and that they receive nothing if the
claim fails. This regime does not apply to the fees of expert witnesses, who
may not be engaged on the basis that they are paid only if the plaintiff by
whom they are called is successful. The defendant referred to an affidavit
sworn by very experienced South African counsel who deposed:
"In my view, if a firm of attorneys with a reasonable infrastructure is of the
view that the claims of the present plaintiffs are good, this would mean that
the firm would be able to earn very substantial sums of money by way of fees.
At the same time, one should not lose sight of the fact that this case is
likely to have a very high profile and that the plaintiffs' attorney(s) would
be accorded a great deal of positive publicity in the media. This would be a
further inducement to take on a case of this nature. There is every reason to
believe that there would be no shortage of firms of attorneys who would be
desirous of taking on such a case if they believed that it had good prospects
of success. Accordingly, if there are attorneys in South Africa who are as
positive about the prospects of success as [the plaintiffs' solicitor] is (as
conveyed in his affidavit), I feel sure that there will be no lack of attorneys
in South Africa prepared to represent these plaintiffs under contingency fee
arrangements."
This very general assertion of belief by a member of the Bar was flatly
contradicted by a number of other equally distinguished counsel who provided
sworn statements to the plaintiffs, and counsel for the defendant indicated
that he placed no reliance on it. More significantly, it received no support
from any practising attorney, and it would be attorneys who would be required,
if these proceedings were undertaken for the plaintiffs on a contingency fee
basis, to finance the investigation of the claims, the obtaining and calling of
evidence and the conduct of the trial during a period which would inevitably
last for months and, very much more probably, years. The clear, strong and
unchallenged view of the attorneys who provided statements to the plaintiffs
was that no firm of South African attorneys with expertise in this field had
the means or would undertake the risk of conducting these proceedings on a
contingency fee basis. The defendant suggested that financial support and
professional assistance might be given to the plaintiffs by the Legal Resources
Centre, but this suggestion was authoritatively contradicted. In a recent
affidavit the possibility was raised that assistance might be forthcoming from
the European Union Foundation for Human Rights in South Africa, but the
evidence did not support the possibility of assistance on the scale necessary
to fund this litigation.
(6) If these proceedings were stayed in favour of the more appropriate forum in
South Africa the probability is that the plaintiffs would have no means of
obtaining the professional representation and the expert evidence which would
be essential if these claims were to be justly decided. This would amount to a
denial of justice. In the special and unusual circumstances of these
proceedings, lack of the means, in South Africa, to prosecute these claims to a
conclusion provides a compelling ground, at the second stage of the Spiliada
test, for refusing to stay the proceedings here.
(7) The conclusions on the funding issue reached by the second Court of Appeal
did not in my opinion take account of the evidence, which did not permit the
finding which the court made.
The plaintiffs, as a ground for challenging the appropriateness of the South
African forum, relied on the absence of established procedures in South Africa
for handling group actions such as the present. They compared that situation
with the procedural situation here, where the conduct of group actions is
governed by a recently-developed but now tried and established framework of
rules, practice directions and subordinate legislation. I do not regard this
objection, standing alone, as compelling. It involves the kind of procedural
comparison which the English court should be careful to eschew (the Spiliada
case, at p 482; the Connelly case, at p 872), and the evidence is clear that
South African courts have inherent jurisdiction to adopt procedures appropriate
to the cases they are called upon to handle. There is force in the
observations of Pill LJ [2000] 1 Lloyd's Rep 139, 162:
"I am entirely unpersuaded by arguments that the South African High Court would
be unable to handle these actions efficiently either on the ground that there
are territorial divisions within South Africa or because there is at present no
procedure expressly providing for group actions. It is common ground that the
law potentially to be applied is the same throughout South Africa. In England,
there has been a vast amount of litigation by victims of asbestos dust without
resort to group actions. Whether by a form of group action or otherwise, I
have no doubt that the High Court of South Africa will be able to devise and
adopt suitable procedures for the efficient despatch of business such as this.
None of the evidence or submissions on behalf of the plaintiffs suggests any
significant obstacle to that efficient despatch by the court of cases before it."
I do, however, think that the absence, as yet, of developed procedures for
handling group actions in South Africa reinforces the submissions made by the
plaintiffs on the funding issue. It is one thing to embark on and fund a heavy
group action where the procedures governing the conduct of the proceedings are
known to and understood by experienced judges and practitioners. It may be
quite another where the exercise is novel and untried. There must then be an
increased likelihood of interlocutory decisions which are contentious, with the
likelihood of appeals and delay. It cannot be assumed that all judges will
respond to this new procedural challenge in the same innovative spirit. The
exercise of jurisdiction by the South African High Court through separate
territorial divisions, while not a potent obstacle in itself, could contribute
to delay, uncertainty and cost. The procedural novelty of these proceedings,
if pursued in South Africa, must in my view act as a further disincentive to
any person or body considering whether or not to finance the proceedings.
Third parties
Both before Buckley J and the second Court of Appeal it was contended by the
defendant and accepted as a factor pointing towards the appropriateness of the
South African forum that the defendant, if sued there, could make and enforce
claims against third parties who could be shown to have contributed to the
plaintiffs' condition, whereas it might be difficult to join such parties and
enforce judgments if the actions were pursued here. The plaintiffs have sought
to meet this point by questioning whether, in truth, the defendant has
disclosed any potential claim against an identified third party with assets or
insurance sufficient to meet any significant claim; by relying on Court of
Appeal authority (see Holtby v Brigham
& Cowan (Hull) Ltd [2000] 3 All ER 421) for the proposition that a defendant is
only liable for such proportion of a plaintiff's damage as he is shown to have
caused; and by formally undertaking, in asbestos (but not mesothelioma) cases,
to limit their claim to compensation for loss and damage for asbestos-related
disease to such sum as would reflect the proportion of a plaintiff's total
asbestos exposure as was shown to be the defendant's responsibility. The
courts below were in my judgment right to treat the third party consideration
as one strengthening the appropriateness of the South African forum, but I am
persuaded by the plaintiffs' response that the refusal of a stay will not
expose the defendant to a significant risk of prejudice so long as any new
claimants are admitted to the group only upon their binding themselves by the
undertaking of the present plaintiffs.
Article 6 of the European Convention on Human Rights
The plaintiffs submitted that to stay these proceedings in favour of the South
African forum would violate the plaintiffs' rights guaranteed by article 6 of
the European Convention for the Protection of Human Rights and Fundamental
Freedoms (1953) (Cmd 8969) since it would, because of the lack of funding and
legal representation in South Africa, deny them a fair trial on terms of
litigious equality with the defendant. For reasons already given, I have
concluded that a stay would lead to a denial of justice to the plaintiffs.
Since, as the Spiliada case [1987] AC 460 makes clear, a stay will not be
granted where it is established by cogent evidence that the plaintiff will not
obtain justice in the foreign forum, I cannot conceive that the court would
grant a stay in any case where adequate funding and legal representation of the
plaintiff were judged to be necessary to the doing of justice and these were
clearly shown to be unavailable in the foreign forum although available here.
I do not think article 6 supports any conclusion which is not already reached
on application of Spiliada principles. I cannot, however, accept the view of
the second Court of Appeal that it would be right to decline jurisdiction in
favour of South Africa even if legal representation were not available there.
Public interest
Both the plaintiffs and the defendant placed reliance on public interest
considerations as strengthening their contentions that these proceedings should
be tried in the forum for which they respectively contended. I agree with my
noble and learned friend, Lord Hope of Craighead, for the reasons which he
gives, that public interest considerations not related to the private interests
of the parties and the ends of justice have no bearing on the decision which
the court has to make. Where a catastrophe has occurred in a particular place,
the facts that numerous victims live in that place, that the relevant evidence
is to be found there and that site inspections are most conveniently and
inexpensively carried out there will provide factors connecting any ensuing
litigation with the court exercising jurisdiction in that place. These are
matters of which the Spiliada test takes full account. It is important that
the focus should remain on the principle so clearly stated by Lord Kinnear: in
applying this principle questions of judicial amour propre and political
interest or responsibility have no part to play.
Article 2 of the Brussels Convention
The House received and heard erudite argument on the applicability of article 2
of the Brussels Convention to a case such as the present. The plaintiffs
submitted that the court was precluded by article 2 from granting a stay. The
defendant argued that the jurisdiction of the court to grant a stay in favour
of a forum in a non-contracting state was unaffected by article 2. The
correctness of the Court of Appeal decision in In re Harrods (Buenos Aires) Ltd
[1992] Ch 72 was in issue. Both parties argued that the answer for which they
respectively contended was clearly correct. If it was not, the plaintiffs
invited the House to seek a ruling from the European Court of Justice, a course
which the defendant resisted.
For reasons already given, I am unwilling to stay the plaintiffs' proceedings
in this country. It is accordingly unnecessary to decide whether the effect of
article 2 is to deprive the English court of jurisdiction to grant a stay in a
case such as this. Had it been necessary to resolve that question, I would
have thought it necessary to seek a ruling on the applicability on article 2
from the European Court of Justice, since I do not consider the answer to that
question to be clear.
Conclusion
I would dismiss the defendant's appeal against the decision of the first Court
of Appeal. I would allow the plaintiffs' appeal against the decision of the
second Court of Appeal and remove the stay which that court upheld. The
defendant must bear the costs of both appeals, and also the costs of the
proceedings before Buckley J and the second Court of Appeal.
JUDGMENTBY-2: LORD STEYN
JUDGMENT-2:
LORD STEYN: My Lords, I have had the advantage of reading in draft the speeches
of my noble and learned friends, Lord Bingham of Cornhill and Lord Hope of
Craighead. For the reasons they give I would also make the order which Lord
Bingham of Cornhill proposes.
JUDGMENTBY-3: LORD HOFFMANN
JUDGMENT-3:
LORD HOFFMANN: My Lords, I have had the advantage of reading in draft the
speeches of my noble and learned friends, Lord Bingham of Cornhill and Lord
Hope of Craighead. For the reasons they give, I would also make the order
which Lord Bingham of Cornhill proposes.
JUDGMENTBY-4: LORD HOPE OF CRAIGHEAD
JUDGMENT-4:
LORD HOPE OF CRAIGHEAD: My Lords, I have had the advantage of reading in draft
the speech of my noble and learned friend, Lord Bingham of Cornhill. I agree
with it, and for the reasons which he has given I, too, would allow the
claimants' appeals and dismiss the appeal by the defendant. I should however
like to add some observations on two matters that were raised in the course of
the argument about the doctrine of forum non conveniens.
Available forum
It is clear that the decision of the first Court of Appeal [1998] CLC 1559 to
refuse a stay was much influenced by the view which they formed about the
defendant's submission that the South African courts were available to the
plaintiffs because it had offered during the hearing before the judge to submit
to the jurisdiction of those courts.
It was not suggested to the judge that there were any reasons for doubting that
this offer had removed the difficulty that the defendant was not otherwise
subject to the jurisdiction of the South African courts as it was neither
present nor had any assets in South Africa. But in the Court of Appeal it was
contended that the offer was objectionable, for two reasons. The first was
that the courts in South Africa were not available at the time when the
plaintiffs brought their proceedings in England, as the defendant did not
indicate its willingness to be sued in South Africa until after the proceedings
had been brought. The second was that the effect of treating the South African
courts as available in these circumstances was to give the defendant a choice
of jurisdiction, enabling it to elect for the court that was more favourable to
it and thus indulge in forum shopping. Evans LJ did not go so far in his
judgment as to say that the South African courts were not to be regarded as
available in these circumstances. But he made it clear that in his opinion the
fact that the South African courts were not available until the defendant
offered the undertakings, and that their availability remained conditional upon
them, were factors which should be taken into account in the application to the
case of the principles stated in Spiliada Maritime Corporation v Cansulex Ltd
[1987] AC 460. The implication was that these were factors to be weighed in
the balance against the defendant in the decision whether or not the action
should be stayed.
This is not a point that required to be considered in Connelly v RTZ
Corporation Plc [1998] AC 854, and I think that counsel for the defendant was
in error when he submitted to the Court of Appeal in the present case that it
could have been: [1998] CLC 1559, 1565F. In Connelly's case the two defendant
companies, like the defendant in this case, were English companies which had
their registered offices in England. But the basis upon which they were being
sued in England was that they were responsible, either directly in fact or
vicariously in law, for defects in the health and safety arrangements at the
mine which was operated in Namibia by a subsidiary of the first defendant by
whom the plaintiff was employed while he was working there: see the issues
which were identified in the Court of Appeal by Waite LJ [1996] QB 361, 364B-D.
The subsidiary, against which the plaintiff had previously directed his claim
at the suggestion of the first defendant, was present and available to be sued
in Namibia. It was common ground that Namibia was a forum that was available
to the plaintiff for his claim of damages. No doubt this was on the view that
for all practical purposes no distinction was to be drawn between the first
defendant, which as my noble and learned friend, Lord Hoffmann, observed [1998]
AC 854, 876G, was a multinational company present almost everywhere, and its
subsidiary in Namibia.
In the present case the asbestos mines and mills in South Africa which were
operated by the defendant's subsidiaries are all closed, and its subsidiaries
are no longer present or available to be sued in that country. The question
whether the South African courts are available to the claimants is thus
entirely dependent upon the proposition that the defendant itself is subject to
the jurisdiction of those courts. As the defendant has no presence in that
country, and as it has no assets there which could be attached to found
jurisdiction, the only ground on which its courts could exercise jurisdiction
against it is that of prorogation. The validity of the defendant's
undertakings is therefore critical to its argument that the South African
courts are available to the claimants as a forum in which their actions should
be tried.
The approach that is to be taken to this question has been examined in a number
of Scottish cases to which it may be helpful to refer, as the underlying
principles which Lord Goff of Chieveley described in the Spiliada case were
derived from the Scottish authorities.
In Clements v Macaulay (1866) 4 Macph 583 an objection was taken to the
jurisdiction of the Scottish courts in an action to enforce a contract entered
into between two Americans on the plea of forum non competens. This was on the
grounds that Texas where the agreement was entered into was the only proper
forum for the dispute and that the Scottish court was an inconvenient and
improper forum. The Lord Justice-Clerk, Lord Inglis, having concluded that the
view that the courts of Texas would have jurisdiction was plainly untenable,
said, at p 592:
"But then I am bound to inquire, if this is an inconvenient and incompetent
forum, where is the proper forum? Apart from the suggestion of Texas, no other
suggestion is made, and I know no case of a plea of this kind being sustained,
where the defender did not satisfy the court that there was another court where
the cause could be tried with advantage to the parties and to the ends of
justice. The defender does seem to have thought himself under obligation to
suggest what was the proper forum, but he has unfortunately suggested one which
has no jurisdiction."
Lord Cowan said, at p 594:
"Your Lordship has conclusively shown that there is no jurisdiction in the
courts of Texas, on the ground stated by the defender, to entertain this
action. Where, then, is the forum on which the defence is founded? When the
court has given effect to such a plea, it has always been because another
forum, specially referred to by the defender as that in which he undertakes to
plead, has been regarded as the more convenient and preferable for securing the
ends of justice. Here the elements for disposing of this defence, pleaded on
this, its essential ground, do not exist."
In Societe du Gaz de Paris v Societe Anonyme de Navigation
"Les Armateurs Francais," 1925 SC 332, 347 the Lord Justice-Clerk, Lord Alness, said that the result of
the cases was that it must be plain that
"another forum is open to the parties." His analysis of the law was approved by Lord Dunedin, 1926 SC (HL) 13, 18, in
your Lordships' House. There is no indication here or in any of the other
Scottish cases that this matter ought to be approached on any other basis than
that this is a requirement that must be satisfied in a practical manner when
the question of forum non conveniens is being considered by the court.
In Clements v Macaulay the defender did not offer an undertaking to submit to
the jurisdiction of the Texas courts. But in Tulloch v Williams (1846) 8 D 657
two actions had been raised against the defender when he was on a visit to
Scotland relating to his conduct while acting as the pursuer's commissioner and
attorney in Jamaica. He lodged with his defences in each action a minute
stating that he was ready and willing to answer in the courts of Jamaica to any
writ or action that the pursuer might bring against him with reference to that
subject matter. The Lord Ordinary said that he was not aware of any authority
for taking the course desired by the defender, which was to decline to proceed
with the case in the meantime leaving it to the pursuer to institute
proceedings against the defender in the courts of Jamaica. In the absence of
such authority he repelled the plea. But he invited the pursuer to consider
the defender's offer as providing the most satisfactory and least expensive way
of having justice administered between them, saying that to go on with the
litigation in Scotland could not fail to be productive of much delay and
additional expense. In the Inner House the process was sisted for three months
in the light of these observations to allow the pursuer an opportunity to bring
an action in the proper court in Jamaica. Lord President Boyle explained, at p
659, that it was a question of convenience whether the case should go on in
Jamaica or whether it should proceed in Scotland upon evidence of the law and
custom of Jamaica.
It was not suggested in Tulloch v Williams that the fact that the defender did
not offer to submit to the jurisdiction of the courts of Jamaica until he
lodged his defences presented any difficulty, either on the ground that the
offer came too late or on the ground that he ought not to be allowed to choose
the jurisdiction in which he was to be sued. His undertaking was seen as the
obvious solution to the difficulty that, although the most expedient course in
the interests of both parties was for the case to be dealt with not in Scotland
but in Jamaica, the defender was not otherwise subject to the jurisdiction of
the Jamaican courts.
In Sim v Robinow, 19 R 665 the defender was sued in Scotland on the ground that
he had been resident there for more than 40 days. He maintained that he was
only a temporary visitor to Scotland, that he was domiciled in South Africa,
that he intended to return to his business in that country and that the courts
of that country were the proper forum for determining the matter in dispute as
they related to transactions between the parties when they were both in South
Africa. His plea that the Scottish courts should decline jurisdiction on the
ground of forum non conveniens was repelled. Lord Kinnear, who delivered the
leading judgment, said that he was not satisfied that it had been shown that
there was another court in which the action ought to be tried as being more
convenient for all the parties and more suitable for the ends of justice. In
regard to the question whether the courts of South Africa were available, he
noted that the defender had not offered the same undertaking as was offered in
Tulloch v Williams. All that he had said was that he intended to go to South
Africa, as to which Lord Kinnear observed, at p 669:
"I do not think that the pursuer can be asked to wait till the defender carries
out this intention, or that he ought to be sent to a court which may be unable
to exercise any jurisdiction over the defender in consequence of his continued
absence from South Africa."
He described Tulloch v Williams, at p 669, as a very exceptional case and
indicated that it ought not to be followed. But this was not because he
thought that it was wrong for the court to proceed on the defender's
undertaking to submit to the jurisdiction of the other court which he offered
after the action had been raised. His criticism of the decision in Tulloch's
case was that the court ought not to have sisted the action for a short period
to await events, but that it ought to have determined the matter either one way
or the other there and then. This was on the ground that, as he put it at p
669:
"if this court is not a convenient forum for the trial of the cause, then the
action ought to be dismissed, but, if this court is a convenient forum, then I
can see no reason why the action should not go on in the ordinary way."
Under Scots procedure a decree of dismissal is a decree which is used when it
is intended to decide that the particular action should not be allowed to Fl
proceed against the defender, but which is intended to leave it open to the
pursuer to bring another action: Maclaren, Court of Session Practice (1916), p
1093.
In the light of these authorities I would have regarded the undertakings which
were offered by the defendant in this case as sufficient to satisfy the
requirement that the alternative forum in South Africa was available because it
had undertaken to submit to the jurisdiction of the courts of that country.
Nothing turns on the time when the undertakings were given. It is sufficient
that they were before the judge when he was considering the question of forum
non conveniens. As for the suggestion that the defendant was choosing its
jurisdiction and thus indulging in a kind of forum shopping, this overlooks the
fact that the issue as to forum non conveniens is for the court itself to
resolve. It is not a matter that is left to the choice of the defender.
Furthermore the court resolves the issue by looking to the interests of all
parties and the ends of justice. As the Lord Justice-Clerk, Lord Alness, said
in Societe du Gaz de Paris v Societe Anonyme de Navigation
"Les Armateurs Francais," 1925 SC 332, 347, it does not do so from the point of view of the defender
only. The only purpose of the undertaking is to satisfy the requirement that
the other forum is available. The ground on which the jurisdiction of the
courts in the other forum is available to be exercised is of no importance
either one way or the other in the application to the case of the Spiliada
principles.
Public interest
In my opinion the principles on which the doctrine of forum non conveniens rest
leave no room for considerations of public interest or public policy which
cannot be related to the private interests of any of the parties or the ends of
justice in the case which is before the court.
In Societe du Gaz de Paris v Societe Anonyme de Navigation
"Les Armateurs Francais," 1925 SC 332, 361, where jurisdiction was established over the defender by an
arrestment to found jurisdiction, Lord Anderson rejected the extreme argument
that that case ought not to be litigated in Scotland at all as it was an action
between two foreigners. He said:
"Anyone who succeeds in founding jurisdiction in this way seems to me to be
entitled, as of right, to invoke the exercise of the jurisdiction so founded,
and the court can only refuse to exercise the jurisdiction invoked if a defence
of forum non conveniens is established."
In the House of Lords, 1926 SC (HL) 13, 21 Lord Sumner was alluding to the same
point when he said:
"Obviously the court cannot allege its own convenience, or the amount of its own
business, or its distaste for trying actions which involve taking evidence in
French, as a ground for refusal . . . the court has to proceed until the
defender objects, but, as against the pursuer's right, the defender has an
equal right to plead forum non conveniens."
In MacShannon v Rockware Glass Ltd [1978] AC 795, 822D, Lord Salmon said that
he did not think that matters of general policy should play any part in
deciding issues of this kind, and Lord Keith of Kinkel made an observation to
the same effect, at p 833D.
The proper approach therefore is to start from the proposition that a claimant
who is able to establish jurisdiction against the defendant as of right in this
country is entitled to call upon the courts of this country to exercise that
jurisdiction. So, if the plea of forum non conveniens cannot be sustained on
the ground that the case may be tried more suitably in the other forum, in the
words of Lord Kinnear in Sim v Robinow, 19 R 665, 668,
"for the interests of all the parties and for the ends of justice," the jurisdiction must be exercised -- however desirable it may be on grounds
of public interest or public policy that the litigation should be conducted
elsewhere and not in the English courts. On the other hand, if the interests
of all parties and the ends of justice require that the action in this country
should be stayed, a stay ought to be granted however desirable it may be on
grounds of public interest or public policy that the action should be tried
here.
I would therefore decline to follow those judges in the United States who would
decide issues as to where a case ought to be tried on broad grounds of public
policy: see Union Carbide Corporation Gas Plant Disaster at Bhopal, India in
December 1984 (1986) 634 F Supp 842 and Piper Aircraft Co v Reyno (1981) 454 US
235. I respectfully agree with Deane J's observation in Oceanic Sun Line
Special Shipping Co Inc v Fay (1988) 165 CLR 197, 255 that the court is not
equipped to conduct the kind of inquiry and assessment of the international as
well as the domestic implications that would be needed if it were to follow
that approach. However tempting it may be to give effect to concerns about the
expense and inconvenience to the administration of justice of litigating
actions such as these in this country on the one hand or in South Africa on the
other, the argument must be resolved upon an examination of their effect upon
the interests of the parties who are before the court and securing the ends of
justice in their case. I would hold that considerations of policy which cannot
be dealt with in this way should be left out of account in the application to
the case of the Spiliada principles.
JUDGMENTBY-5: LORD HOBHOUSE OF WOODBOROUGH
JUDGMENT-5:
LORD HOBHOUSE OF WOODBOROUGH: My Lords, for the reasons given by my noble and
learned friends, Lord Bingham of Cornhill and Lord Hope of Craighead, I, too,
agree with the order which Lord Bingham of Cornhill has proposed.
DISPOSITION:
Orders accordingly.
SOLICITORS:
Leigh Day
& Co; Davies Arnold Cooper.