Brussels Regulation overrides US pending action


In Catalyst Investment Group v Max Lewinsohn and Others [2009] EWHC 1964 (Ch) the defendants, who were domiciled in the UK, sought a stay of three sets of proceedings on the basis that the most appropriate forum was the Utah court, in the US, where there were pending actions between the same parties and involving the same cause of action.

The case resurrected the long standing conflict between the mandatory requirements of the Brussels Regulation, which in Article 2 states that “…persons domiciled in a Member State shall, whatever their nationality, be sued in the courts of that Member State”, and the English common law doctrine of forum non conveniens, which gives the English court discretion to stay proceedings on the basis that it would be more appropriate for them to proceed elsewhere.

The conflict was almost finally settled in favour of the Regulation by the European Court of Justice in Owusu v Jackson (Case C-281/02) which held that even where no other member state was involved, Article 2 applied and the court could not stay its proceedings.

The defendants in this case argued that because the Brussels Regulation, in Article 27, applies the principle of lis alibi pendens, as between member states, then by analogy the English court could stay proceedings, on the same principle, as between itself and a non member state.

The court held that it would be introducing forum non conveniens by the back door and would be contrary to Owusu.

Comment: It remains possible for the English court to stay proceedings in favour of a non member state’s court, pursuant to Article 23 of the Regulations, where there is an exclusive jurisdiction agreement.

Paul Howcroft, Partner, Fladgate LLP

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