EUPillar Primacom Holding GmbH v A Group of the Senior Lenders & Credit Agricole [2011] EWHC 3746 (Ch)

Summary

The case was concerned with an application by PrimaCom Holdings GmbH. The applicant wanted to convene meetings of creditors to consider and approve a scheme of arrangements proposed by the company. The company in question was domiciled in Germany which posed the question whether the English court had jurisdiction to sanction the scheme. The value of the scheme was in tens of millions which suggested that another question would be whether the decision would be recognised in Germany. Mr Justice Hildyard held: “66 There are two points to be considered. The first is whether under German law the sanction of a scheme would be recognised under art.32 of the European Regulation 44/2001 on Jurisdiction Recognition and Enforcement. […] Professor Paulus considers that the ultimate result will be to determine that a judgment sanctioning a scheme does fall within art.32 but recognises that for the moment that point is uncertain. 67 The second issue under this head, therefore, is whether the German substantive law […] would recognise the appropriate law to determine the relevant extinction or restructuring of rights governed by English law would be English law. In that context, Professor Paulus concludes that since the debts in question are subject to English law, that law governs not only the formation but also the extinction and restructuring of those debts, be it by fulfilment, settlement or, as in question, by a scheme of arrangement. 68 I pause only to note one further point: this is that Professor Paulus also gives as his opinion that the recognition or enforcement of a scheme of arrangement promulgated and sanctioned under English law would not be incompatible with the public policy of Germany. 69 Whether at the fairness hearing other evidence is brought to bear to dislodge that conclusion I cannot tell, but for the present it seems to me that there is sufficient ground for the conclusion that the English court exercise of jurisdiction would be given effect in Germany to warrant the scheme progressing to the next stage.” [66-69]. The judge felt that there was no need to make reference to the Court of Justice, and followed Rodenstock GmbH, Re [2011] EWHC 1104 (Ch). His position was summarised in a judgment ([2012] EWHC 164 (Ch)) rendered on the 20th January 2012 when the scheme was approved. “13 […] art.2 is subject to arts 23 and 24 and on the facts of this case, as it seems to me, both are satisfied. 14 Dealing first with art.23, it is an important feature for these purposes of this case that every one of the loan agreements and also the umbrella agreement is expressly governed by English law and expressly nominates the English forum as the exclusive forum for the adjudication of their disputes. That is a peculiarity of this case, though it will not necessarily be an unfamiliar circumstance. […] 15 Secondly, and again on the facts with regard to art.24, I do accept that before me on the previous occasion there were, at least as I understood it, before me by counsel, a majority of creditors, especially in the first tier, who by their participation in that proceeding, which was of substance in that it related to the jurisdictional issue as to the proper constitution of classes, had consented or submitted to the jurisdiction of this court. Therefore, the factual circumstances posited by art.24 seem also applicable. 16 The fourth possibility was that canvassed by Briggs J. in the Rodenstock case, that by analogy with art.4 the English court should accept jurisdiction. My own preference is to adopt one or other of the other three solutions, but of course, that may well indicate no more than that I have not properly grasped the full extent of the analogy which art.4 offers. 17 On that basis it does not appear to me that the Judgments Regulation poses any obstacle to my accepting that the English court has jurisdiction in the matter. […].” [13-16].