Case number and/or case name
The Bank of Tokyo-Mitsubishi Ltd and Another v Baskan Gida Sanayi Ve Pazariama as and Others [2004] EWHC 945 Ch
Summary
The dispute arose out of a number of contractual arrangements: a) Financing Facility Granted by the claimants to Baskan Gida, a Turkish company; b) Formal Framework Contract between Baskan Gida and Ferrero Companies. Financial. The claims were contractual and tortious in so far as the claimants alleged that the defendants were engaged in fraudulent activities.
There were parallel proceedings. One set of proceedings was initiated in Italy on 31st January 2003. These were initiated by Ferrero Italy and Ferrero Industrial, seeking a declaration that they owe nothing to Baskan and/or the Banks.
On 18th July 2003, another set of proceedings was commenced before the English courts. In England, there were two banks on the claimant’s side. They brought a claim against multiple defendants, seeking damages (contractual and tortious) in the amount of approximately 24 millions.
On the basis of Articles 27 and 28, the English court stayed the proceedings (in respect of contractual claims). However, the English court assumed jurisdiction to hear and determine the tortious claims against Ferrero Companies. Mr Justice Collins held that:
“208 The “object of the action” (the end the action has in view) in both jurisdictions is essentially the same, even though the claim in Italy is for a negative declaration. Both actions are about the liability of Ferrero Industrial and Ferrero Italy on the contracts, the assignments, and the undertakings.
209 Consequently, the English action against Ferrero Industrial and Ferrero Italy should be stayed under Art.27(1) until the decision of the Court of Cassation on the jurisdictional objections by the Banks.
210 But I do not consider that there is any basis for the argument that the tortious claims are within Art.27 . No such claims had been asserted when the Italian proceedings were commenced. The Italian proceedings were clearly a pre-emptive strike to anticipate the Banks' contractual claims. It is true that the claim for a negative declaration is a claim that Ferrero Industrial and Ferrero Italy owe nothing “for whatever reason” with respect to the contracts with Baskan Gida for the sale of hazelnuts, and that Ferrero's Italian lawyer, Mr Benessia, has expressed the view that in Italian law this is effective to deal not only with contractual claims, but any other ground, including any alleged tort. But both Mr Benessia and the Banks' lawyer, Professor Canale, agree that the answer to the question of what claims are included depends on the intention of the parties, and I am satisfied that Professor Canale's approach leads to the correct conclusion that such claims were not envisaged, notwithstanding that it may be that the background and facts in the English tortious claims are common to the limited tortious claims made by Ferrero Industrial and Ferrero Italy against the Banks in the Italian proceedings.
[...]
214 In my judgment there is a good arguable case that the English court has jurisdiction in relation to the tortious claims (other than the claims arising from the letter of December 13, 2001, with which I deal below) by virtue of Art.6(1).
[...]
222 I will allow the amendments to plead deceit and negligent misrepresentation. […]
223 The Banks have a good arguable case that the English court has jurisdiction under Art.5(3) because the damage occurred in England: it is pleaded that in reliance on the representations the Banks entered into the facility agreement and made the advances. It was in England where the facility agreement was entered into and from where in commercial terms the advances were made, and from where the Banks' resources were diminished by their reimbursement of Akbank. It is not therefore necessary to decide whether the decision in Domicrest applies equally to fraudulent misrepresentation, or whether it was rightly decided.” [208-210, 214 and 222-223]