The judgment of Master Fontaine in Ibrahim v AXA Belgium [2024] EWHC 856 (KB) makes for useful reading on relief from sanctions applications and jurisdiction challenges. This post was written by Rebecca Henshaw-Keene.
The facts: The claim was for damages for personal injury sustained by the Claimant in a road traffic accident in Belgium on 15 March 2019.
The applications: The Defendant sought a declaration that the court should not exercise jurisdiction over the claim on forum non conveniens grounds, and a stay of proceedings.
Relief from sanctions
Unfortunately, the application was made 30 days after filing the acknowledgement of service. CPR 11.1(4) dictates the application must be made within 14 days.
It was agreed that to benefit from an extension of time to make the application, the Defendant must satisfy the test laid down in CPR 3.9 / the guidance given by the Court of Appeal in Denton v T. H. White Limited [2014] EWCA Civ 906.
The application was dismissed. The Master made the following points:
The seriousness and significance of the breach: The Defendant relied on the fact that an application for a stay on jurisdictional grounds can be made at any time in the proceedings, by contrast to an application seeking an order that the court has no jurisdiction.
In [Texan Management Ltd & Ors v Pacific Electric Wire & Cable Company (Rev 2) [2009] UKPC 46], the Privy Council summarised the position:
“…it does not follow that a defendant who fails to make an application for a stay at the outset of proceedings is thereafter debarred from seeking a stay. The tight time limits in the English CPR Part 11 and EC CPR r.9.7 make complete sense in the case of applications to set aside service or discharge an order for service out of the jurisdiction…”
… But these provisions do not sit easily with applications for stays. For example, circumstances may change and a defendant may wish to apply for a stay well after the proceedings have commenced…
A defendant served within the jurisdiction who has reasons for applying for a stay on forum conveniens grounds at that time should normally make the application under EC CPR r.9.7/English CPR Part 11. It is doubtful whether failure to make such an application in time means that the defendant has conclusively accepted that the court should exercise its jurisdiction, but that will not normally matter because the court has a power to extend the time for compliance with any rule, even if the application for extension of time is made after the time for compliance has passed: EC CPR r.26.1(2)(k).
This did not assist the Defendant where the Court found there had been no change of circumstances, and the Defendant had been in a position to apply for a stay at the outset of proceedings.
The reason the Defendant had not done so was that they were not aware of the English proceedings (more on this below). It was unlikely that the Privy Council meant that a defendant’s own mistake or inefficiency would constitute a change in circumstances.
Turning to delay, the Defendant pointed to case law to suggest that delays in and of themselves may not necessarily constitute a serious and significant default. Master Fontaine found this to be an incomplete answer to the breach. A successful jurisdictional challenge would force the claimant in this jurisdiction to discard their claim, and potentially incur irrecoverable costs. They would have to pursue their claim in a jurisdiction which is likely to be unfamiliar to them and in a language they may not know.
The 14-day period set out in CPR 11.1(4) was limited so that breaches of time could not be easily excused.
Why the default occurred: The Defendant accepted there was no good reason for the breach. There had been misunderstanding or breakdown in communications between AXA UK and the Defendant AXA Belgium.
All the circumstances of the case
The following matters were material:
- The Defendant had failed to notify the Claimant in advance of the intention to institute proceedings in Belgium when the Defendant had been corresponding with the Claimant or his English solicitors since March 2019, and waited until January 2024 to bring proceedings in Belgium.
- The Defendant was also aware that the Claimant had undergone examination by English medical experts and had produced reports for the purpose of the proceedings, and had incurred costs in so doing.
- They had also failed to notify Clyde & Co of the institution of proceedings in Belgium.
- There was a lack of a proper explanation to this court as to how the situation had arisen.
Because of the lack of any good reason for the breach and the circumstances in which the breach came about, regardless of any prejudice to the progression of the litigation, the application was dismissed.
The application for a stay
The Master dealt with this in the event that she was wrong to dismiss the application for an extension.
The starting point for a stay on forum non conveniens grounds was summarised by the Master, per Spiliada Maritime Corp v Cansulex Ltd [1986] UKHL 10:
First, a defendant has the burden of showing a foreign court is clearly and distinctly the more appropriate forum for the trial of the claim. If that is shown, the court will ordinarily grant a stay unless the claimant can establish that there are circumstances by reason of which justice requires that a stay should not be granted.
The competing factors were set out. A number of these relate specifically to road traffic accident litigation in Belgium. Of wider application, the following was relied on by each party.
For the Defendant:
- The driver of the offending car was domiciled in Belgium, and the car was registered in Belgium.
- The Belgian proceedings included two other parties, and one or other of those parties, or both, were responsible for the road and the pedestrian crossing where the accident occurred.
- No witnesses from England were required to give evidence in the Belgian proceedings.
- The enforcement of a Belgian judgment in Belgium is a simple matter, whereas, post Brexit, the enforcement of an English judgment is not straightforward.
- The Claimant signed a statement made in Dutch very shortly after the accident at the police station.
- The Claimant should be able to travel to Belgium for medical examinations.
For the Claimant:
- The Claimant and his family were resident in England at the time of the accident and remain resident in this jurisdiction. All of the Claimant’s lay and expert witnesses are in England, as are both parties’ solicitors.
- The Claimant did not speak or understand Dutch, and was too vulnerable to travel to Belgium.
- The courts in England would be capable of applying the law of Belgium to the causation and quantum issues in the claim.
- There are restrictions in the Belgian courts as to how many medical experts can be appointed. One of the foreign law experts to the case suggested that reports from at most three subsidiary experts would be permitted, and the experts would not be questioned, but only comments made on their reports.
- There was no suggestion that interim payments would be available.
- In Belgium the maximum costs the Claimant would be able to recover would be fixed costs of a maximum of €42,000, and any shortfall would have to be made up from his damages.
- Regarding enforcement, a Belgium judgment authorising enforcement can be obtained by a process of exequatur, which will usually take between 6 months and 1 year.
Decision on jurisdiction
The Master cited the following well known principles:
From Brownlie II (FS Cairo (Nile Plaza) LLC v Lady Brownlie [2021] UKSC 45)
- The jurisdiction must be where the dispute has its “closest connection”
- That where pain, suffering, loss of amenity and permanent disability suffered by a claimant resident in this jurisdiction in a road accident that occurred in another jurisdiction: “The damage is in a very real sense sustained in the jurisdiction”.
From VTB Capital plc v Nutritek International Corp and ors [2013] UKSC 5
- That the place of commission will normally establish a prima facie basis for treating that place as the appropriate jurisdiction but the significance attaching to the place of commission may be dwarfed by other countervailing factors.
In this case, where liability was admitted and no allegation of contributory negligence was made, then the place of commission was of “much less importance”. Where some elements of quantum (injury) were based on a tariff system in Belgium, then the matter could be relatively straightforwardly tried in the High Court.
The provision of experts was important. Whilst the Belgium court’s approach would not necessarily disadvantage the Claimant, the Master was concerned that the range of permitted expert evidence could adversely affect the Claimant in relation to the issue of causation. The Claimant had already instructed an orthopaedic expert who had recommended further investigation from a neurological expert, and care evidence. The Claimant’s pain expert had recommended further treatment including pain physiotherapy and psychotherapeutic input. The Master was sufficiently persuaded that, in a Belgian court, the Claimant would not be permitted to have this range of experts.
That enforcement would be quicker in Belgium was a neutral factor. Where the Defendant was part of a substantial international insurance group this was also less important.
It was further unjust to the Claimant to confine him to pursue his claim to the Police Court in Belgium (the specialist court dealing with road traffic accidents). The Claimant had an unresolved pain condition and travel to Belgium would be disadvantageous. Neither did he understand Dutch.
As to costs, the Claimant had incurred legal costs and disbursements in England. The Defendant had not suggested that it would compensate the Claimant for any costs if proceedings were to be stayed. The Defendant’s argument that the Claimant should have been aware that it was always open to the Defendant to seek a stay was not successful. As the Claimant has argued there was no guarantee he would be able to make up any shortfall in legal costs in the Belgian proceedings.
Practical takeaways
- The Court will consider relief from sanctions applications holistically, as they are required to do in the third part of the Denton test. Pointing to a relatively short period of non-compliance will not assist where, on a reading of the practice direction or a consideration of prejudice, the period of delay is a secondary factor. Further, where there is apparently no reason for which the Court can find sympathy for the applicant’s position, they face an uphill battle.
- The Master made a point of noting the Defendant’s failure to offer to pay costs arising out of the stay. There were other obvious conduct points raised throughout.
- The decision on jurisdiction (albeit not needed as the application for relief had failed) was – as usual – closely tied to the features of the dispute. In this case, where causation would be the main battleground, the disparity between the English and Belgian systems as to the Claimant’s ability to call and rely on a range of experts was important.