06
Jul
22
Articles, Travel & Cross Border Claims
Retained Jurisdiction: When Can Practitioners Be Certain That The Courts Will Accept Jurisdiction Over Claims Arising Out Of Accidents Abroad?

Now that the dust has settled following Exit Day on 31st December 2020, the recast Brussels Convention has ceased to apply in the UK, and cross border practitioners have got used to the idea that the UK is not going to be allowed to accede to the Lugano Convention any time soon, it’s time to take stock of the jurisdictional position. In most cases with a foreign element, the courts of England and Wales are now applying the jurisdictional rules contained within CPR Part 6.36; permission is required for Defendants located outside the jurisdiction to be served, and a Defendant can apply for a claim to be stayed on the basis that England and Wales is not the appropriate forum within which to hear it. In two distinct categories of case, however, these rules do not apply; and it is the view of the authors that practitioners are not utilizing these jurisdictional regimes as fully as they could.

In anticipation of Exit Day, the Civil Jurisdiction and Judgments Act 1982 was amended to preserve the jurisdictional regime provided for by Regulation (EU) No. 1215/2012 (‘recast Brussels’) in respect of two important areas – consumer contracts and individual contracts of employment. The new s.15A expressly states that these provisions only apply where the subject-matter and nature of the proceedings fall within Article 1 of recast Brussels, which is to say that it is a civil or commercial matter; but this requirement will be met in almost all claims falling with ss.15B and C.

Consumer Contracts

Pursuant to s.15B(2) where a consumer is domiciled in the UK and where the subject-matter of proceedings is ‘a matter relating to a consumer contract’:

“The consumer may bring proceedings against the other party to the consumer contract—

(a) where the other party to the consumer contract is domiciled in the United Kingdom, in the courts of the part of the United Kingdom in which the other party to the consumer contract is domiciled, or

(b) in the courts for the place where the consumer is domiciled (regardless of the domicile of the other party to the consumer contract).”

The consumer’s choice is unfettered by considerations of where (s)he may have suffered the loss for which (s)he claims compensation, or by notions of forum conveniens; (s)he may choose the jurisdiction most advantageous to his or her purposes, and the Defendant is powerless to escape it. The Defendant may not forestall this unrestricted choice by way of any provision in its standard terms and conditions, either; pursuant to s.15B(6) the right to choose jurisdiction under s.15B can be departed from only by an agreement entered into after the dispute has arisen; by adding additional jurisdictional choice; or by conferring jurisdiction on a legal system within the UK within which both Claimant and Defendant are domiciled.

It would seem, therefore, that where a UK domiciled Claimant, acting as a consumer, enters into a contract with a foreign entity, and suffers loss during the course of the performance of that contract, (s)he may sue the other party to it within the courts of his or her home domicile. And this is indeed the effect of s.15B – with one caveat. The provision is subject to s.15E, which sets out an additional requirement failing which the claim does not come within s.15B:

“consumer contract” means—

(a) a contract for the sale of goods on instalment credit terms,

(b) a contract for a loan repayable by instalments, or for any other form of credit, made to finance the sale of goods, or

(c) a contract which has been concluded with a person who—

(i) pursues commercial or professional activities in the part of the United Kingdom in which the consumer is domiciled, or

(ii) by any means, directs such activities to that part or to other parts of the United Kingdom including that part,

and which falls within the scope of such activities,

but it does not include a contract of transport other than a contract which, for an inclusive price, provides for a combination of travel and accommodation or a contract of insurance.”

The Act therefore preserves the requirement under recast Brussels that the party to the contract other than the consumer must direct its activities to the consumer’s domicile and also importantly contains the (frustrating) provision that it only covers contracts for transport and accommodation. The CJEU has previously ruled that this provision is to be construed as narrowly as the wording suggests and doesn’t encompass the wider definition of ‘package’ within the Package Travel and Linked Travel Arrangements Regulations 2018 (i.e. encompassing other tourist services).

Although post Brexit the rulings of the CJEU are only persuasive to the English Court there is nothing to suggest that the English Court would come to a different conclusion than did the CJEU and so, for example, if a Claimant is injured during an open top bus tour, the fact that the trip also includes a stop at a historic site and a buffet lunch is unlikely to be sufficient to trap it within the claws of s.15B.

However, if you will permit us to engage in idle speculation for a moment, it could be that the English Courts, keen to bring in work to these shores, may in future be prepared to deviate from the CJEU’s narrow interpretation. This desire to ensure the courts remain busy post Brexit could be one explanation for the adoption of the wide definition of ‘damage’ as per the supreme Court in Brownlie II. Given these economic pressures, it is not beyond the realms of possibility to imagine the English Courts trying to push a teleological interpretation of this section.

In practice, it is likely to be a relatively simple matter to show that a business directs its activities to the consumer’s domicile; a website offering an English language version, the option to pay in sterling, and testimonials and reviews from English customers are all strong indicators that a business is plying its trade within this jurisdiction. Some businesses, such as many offering cosmetic surgery abroad, make much of this connection; they cannot then disavow it when it comes to jurisdictional analysis.

It is also noteworthy that it is not necessarily the case that the consumer in question need have entered into the contract in the sense that (s)he signed on the dotted line; in Lackey v Mallorca Mega Resorts SL [2020] 1 All ER 158 the court found that the equivalent provision contained within recast Brussels was satisfied where the Claimant’s friend made a holiday accommodation booking on behalf of a group including the Claimant. Applying a purposive approach to the Regulation such a finding was perhaps inevitable; and as above, it is unlikely  the English courts would have an appetite to make jurisdiction more difficult to establish.

In the experience of the authors this provision is under-used to the same degree practitioners have never really got to grips with s.75 of the Consumer Credit Act 1974; in some cases there is a simple and effective answer to any jurisdictional problem, and it is perhaps surprising that it is not utilised more often.

 Employment Contracts

The other area in which the Act confers jurisdiction over claims previously governed by recast Brussels is set out in s.15C relating to proceedings whose subject-matter relates to an individual contract of employment:

“(2) The employer may be sued by the employee—

(a) where the employer is domiciled in the United Kingdom, in the courts for the part of the United Kingdom in which the employer is domiciled,

(b) in the courts for the place in the United Kingdom where or from where the employee habitually carries out the employee’s work or last did so (regardless of the domicile of the employer), or

(c) if the employee does not or did not habitually carry out the employee’s work in any one part of the United Kingdom or any one overseas country, in the courts for the place in the United Kingdom where the business which engaged the employee is or was situated (regardless of the domicile of the employer).

(3) If the employee is domiciled in the United Kingdom, the employer may only sue the employee in the part of the United Kingdom in which the employee is domiciled (regardless of the domicile of the employer).”

An employee may therefore bring a claim in for personal injury, for instance, either in the courts of the employer’s domicile, or in the courts of the place where the employee habitually carries out his or her duties, or in the courts of the place where the business which engaged the employee is situated.

These important provisions allow employees to choose whether to sue their employers in the latter’s home domicile, or in the place from which they work, or where any employment agency may be situated – circumventing the all too familiar problems arising where a Claimant is engaged via an agent for an entity based overseas, or where a Claimant is sent to various different overseas destination to carry out his or her duties. Again, the employment contract cannot derogate from these jurisdictional rights; pursuant to s.15C(6) the provision can be departed from only by an agreement entered into after the dispute has arisen, or by adding additional jurisdictional choice.

Once again, these provisions provide for a simple and effective way around many of the problems experienced by employees seeking to bring claims within the jurisdiction of England and Wales, particularly in respect of peripatetic workers and those engaged by agencies. It is worth noting that the increase in working from home may in itself bring more employees within s.15C(2)(b) if they can reasonably be said to carry out their work habitually from their home within England and Wales. In this respect it is important to note that the accident which founds the claim need not have occurred during the course of this habitual work pattern but could very easily have occurred abroad in some third country.

 

About the Authors

Mike Hagan is a senior solicitor and head of the travel team within the flagship Serious Injuries Unit at Fletchers Solicitors. He is cited in the Legal 500 for his work, and his cases have been frequently covered by both the local and national press.

Called to the Bar in 1997, Sarah Prager has been listed in the legal directories as a Band 1 practitioner in travel law for many years. Together with her colleagues at 1 Chancery Lane, Matthew Chapman QC and Jack Harding, she co-writes the leading legal textbook in the area, and has been involved in most of the leading cases in the field in the last decade. She was recently named Travel Lawyer of the Year 2022 by Best Lawyers UK, and Personal Injury Advisor of the Year 2022 by Global 100 and Lawyer International Legal 100.

Written by or involving: Sarah Prager

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