Can a defendant who unnecessarily submits to the jurisdiction be an “anchor defendant”?

This is a short blog considering a fairly niche but potentially important issue. The situation is this:

The Claimant brings a claim against a foreign-domiciled D1, who submits to the jurisdiction. In fact, if D1 had not submitted, then there would not have been any valid jurisdictional basis for the claim against D1.

Can D1 be used as an “anchor defendant” for the purpose of the “necessary or proper party” service gateway in a claim against D2?

This might happen in one of two situations:

  • D1 makes a mistake: perhaps it fails properly to assess the jurisdictional position before submitting; or perhaps its representatives accidentally take some step in the litigation that amounts to a submission.
  • The Claimant and D1 collude to bring about a situation where they and D2 are all parties to the same litigation.

D2 suggested that the second situation was occurring in ID v LU & Anor [2021] EWHC 1851 (Comm). D1 could have insisted on being sued in its home courts in Ukraine under art. 4 of Brussels I (Recast), but apparently chose not to in order to engineer a situation where D2 were also before the court.

The Claimant sought permission to serve on D2 pursuant to the “necessary or proper party” service gateway (CPR 6BPD 3.1(3)) relying on D1’s submission to the jurisdiction. D2 argued that it was not entitled to do this as a matter of authority.

This was based on the old pre-CPR cases of John Russell and Company Ltd v Cayzer Irvine and Company Ltd [1916] 2 AC 298 and The Benarty [1983] 1 Lloyds Rep 361.

These apparently established that there could be no reliance on the then equivalent of the “necessary or proper party” gateway if, at the time when a writ was issued, there was no one on whom it could be served and only at a later stage did one of the defendants accept service in the jurisdiction.

HHJ Pelling QC agreed with D2 that those authorities still applied under the modern CPR. The Claimant must have been able to serve on the anchor defendant without submission or the “necessary or proper party” gateway would not be open to it:

The various provisions within 6BPD under which service out of the jurisdiction can be permitted are a carefully calibrated list of exceptions to the general rule that requires service to be on a defendant in the jurisdiction. Permitting service on an allegedly necessary or proper party by reference to an anchor defendant who has voluntarily submitted to the jurisdiction defeats that careful construct in relation to an anomalous jurisdiction as well as being contrary to the express terms of Gateway 3. This suggests that permitting such an outcome as a matter of construction would defeat that construct and the reasons for it.

There were good reasons for continuing to protect defendants against the anomalously wide scope of the “necessary or proper party” gateway:

There is no reason to suppose that the drafters of the current version of the rule would have wanted to reduce the protections conferred on parties with no connection to this jurisdiction. There is as much a need for such protection under the current iteration as there was under the earlier ones. The case law in relation to Gateway 3 has consistently noted it to be anomalous and on the need for caution if it is not to be exorbitant in its scope.

In conclusion:

In summary, in relation to the issue I am now considering, I conclude that at least the narrower view of the John Russell principle adopted by the Court of Appeal in The Benarty (ibid.) continues to apply on a true construction of paragraph 3.1 of 6BPD, in addition to the requirement that there is between the claimant and anchor defendant a real issue which it is reasonable for the court to try. Given that there is no evidence from the claimant that the claim against the first defendant does not fall within the narrower view of this principle the second defendant’s challenge to jurisdiction succeeds on this point.

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