Summary
The proceedings arose in respect of a vessel, The Alexandros T. The ship sank in 2006. The insurance policies included English law and jurisdiction clauses.
The shipowners, Starlight, began proceedings in England against the defendants who were insurers. The original proceedings were initiated on 15th August 2006. On 13th December 2007 and 3rd January 2008, the English proceedings were settled. The settlement agreement included an English choice-of-court agreement.
Nonetheless, more than three years later, Starlight began proceedings in Greece claiming damages from the insurers for late payment (whether deliberate or otherwise) and in respect of supposed misconduct by insurers.
The insurers commenced proceedings in England, seeking a declaration that matters sought to be litigated in Greece formed part of the English settlement as well as damages for breach of the jurisdiction clause. Starlight made an application for a stay of the English proceedings under Brussels I.
On 19th December 2011, the High Court dismissed the application for a stay of legal proceedings.
An appeal was made before the Court of Appeal. On 20th December 2012, the Court of Appeal allowed the appeal.
The matter reached the UK Supreme Court. On 6th November 2013, the UK Supreme Court refused a stay of the English proceedings. In this context, Lord Clarke (with whom Lord Sumption and Lord Hughes agreed) held:
“41 The question is whether these claims involve le même objet et la même cause as the claims in the Greek proceedings. In my opinion they do not for the same reasons as in the case of the claims for an indemnity and the claims arising out of the exclusive jurisdiction clauses. The Greek claims are claims in tort and these are contractual claims. The factual bases for the two claims are entirely different. Moreover the object of the two claims is different.
[…]
44 Lord Mance takes a different view in one respect. […] He notes in para 140 the terms in which the claims are pleaded. The formulation in paragraph 18(a) above, which was adopted by the respondents, is in fact derived from the declaration made by the judge. However, to my mind nothing turns on this difference. Moreover, I do not see that it makes any difference that the respondents discharged their obligations under the settlement agreements.
[…]
47 […] I would hold that Article 27 does not apply to any of the causes of action advanced by or against the CMI.” UKSC [41, 42, 44, 47]
A somewhat different view was taken by Lord Neuberger:
128 I see the force of Lord Clarke's view that the English declaration claims do not have “le même objet et la même cause” , if one gives that expression a very narrow effect. […]
129 However, it is also important to appreciate that the fundamental purpose of Article 27 , as explained by the CJEU, is to ensure that judgments obtained in one member state are enforceable in other member states, and that the consequence of this is that one should avoid mutually inconsistent judgments. The purpose of Article 27 is to help achieve that end.
130 […] it seems to me that there is a real case for saying that the English declaration claims should be stayed.” UKSC [128-130]
Lord Mance had this to conclude:
“161. It follows that the conclusions I would reach, were all the issues to be finally decided now, would be that:
i) The first head of English release claims would be precluded under article 27 , having regard to what I conclude are in this respect the prior Greek claims.
ii) All the remaining heads are outside the scope of article 27 and are permissible. It is however necessary to consider whether these conclusions are founded on principles of European law which are so clear that no reference to the Court of Justice is required.
[…]
162 In relation to the conclusion expressed in para 161ii, we are all in agreement in our conclusions. Any differences in reasoning regarding article 27 are irrelevant, and no reference is necessary.” UKSC [161-162].