02
Aug
21
Articles, Travel & Cross Border Claims
The Weekly Roundup: the Don’t Mention X v Kuoni Edition

Readers may be surprised to find that we do not intend to cover the decision of the Supreme Court in X v Kuoni [2021] UKSC 34 in this edition of the Weekly Roundup. This is of course because we can’t improve on the special briefing here (Case Update: The Supreme Court Judgment in X v Kuoni Travel [2021] UKSC 34 – 1 Chancery Lane) and we don’t want to pre-empt the webinar on the subject on Thursday (register here: 1CL Webinar: Claims for Deliberate Acts under the Package Travel and Linked Travel Arrangements Regulations 2018 – 1 Chancery Lane). We look forward to seeing you then for a discussion about the scope of the duty owed by package organisers and of the defences under Regulation 16 of the 2018 Regulations.

Don’t Mention the Court of Appeal to Coulson LJ

Last week, the Court of Appeal handed down its judgment in Municipio de Mariana v (1) BHP Group PLC (formerly BHP Billiton PLC) (2) BHP Group Ltd [2021] 7 WLUK 418, which grappled with questions of jurisdiction and gave some guidance to practitioners drafting grounds of appeal.

Factual background

In late 2015, the Fundão dam in south-eastern Brazil collapsed. The collapse of the dam had catastrophic consequences, releasing vast quantities of iron ore mine tailings into the Doce River, which damaged, destroyed or contaminated everything in its path. Villages were obliterated, individuals died, and thousands suffered loss.

Proceedings were issued in November 2018. Whilst initially bringing proceedings against six parties, the Defendants were later narrowed down to BHP Group PLC, an English company, and BHP Group Ltd, an associated Australian company, who were served within the jurisdiction. BHP Billiton, a subsidiary of BHP Group Ltd, was a partner in the Brazilian joint venture which owned and operated the dam, Samarco. BHP applied in August 2019 for the claims to be struck out or stayed, prior to serving a Defence.

The strike out application originally came before Mr Justice Turner in July 2020, who held that:

  1. The claims were “irredeemably unmanageable” and should be struck out.
  2. Had the claims not been struck out, they would have been stayed (in the case of BHP Group PLC, under Article 34 of the Brussels I Regulation (Recast), and in the case of BHP Group Ltd, because England was not the appropriate forum).

The Claimants made an application for permission to appeal. Coulson LJ refused permission on paper. The Claimants then applied to re-open the refusal to grant permission to appeal under CPR 52.30. Coulson LJ then recused himself from dealing with that application, which was then to be determined at an oral hearing.

The Claimants argued that the appellate judge failed to grapple with the four main points raised on the application for permission to appeal, namely that:

  • there was no legal basis to strike out proceedings as an abuse of process on the grounds of “irredeemable unmanageability”.
  • the Judge had invented the concept of what was described as “jurisdictional abuse”.
  • there had been no basis for the judge to strike out claims brought as of right against defendants duly served within the jurisdiction. The Judge had also ignored Article 4 of Brussels Recast and created impermissible barriers to the claimants’ access to justice.
  • the Judge misapplied the principles in Henderson v Henderson (1843).

Preliminary points

Before turning to the Claimants’ criticisms of Coulson LJ’s reasoning, the Court of Appeal made a number of preliminary points. The Court noted that Coulson LJ did not refer to the particulars of the grounds of appeal at all, except to one paragraph. Further, by considering each of the 15 grounds of appeal one-by-one, it may have made it more difficult for Coulson LJ to identify the inter-relationship of the various grounds relating to abuse of process. Coulson LJ also made no reference to the Claimants’ skeleton argument. Whilst that in and of itself could not be a basis for re-opening his decision, the Court noted that it was necessary for Coulson LJ to read and digest the skeleton, and noted that in some cases, it will not be possible to explain why permission is refused without making reference to it.

The Court further noted that it was not an entirely safe course of action for Coulson LJ to refer repeatedly to submissions addressed in the permission to appeal judgment, because the grounds of appeal were substantially re-drafted following the refusal of permission to appeal. In addition, the particulars of the grounds of appeal were substantially re-drafted and were much shorter.

Judgment

The Court of Appeal granted the Claimants permission to appeal. The Court considered that Coulson LJ did not address the point of principle that unmanageability was not a proper ground on which to strike out a claim for abuse of process. His reasoning did not address the question of whether that conclusion could justify a strike out either at all, or in circumstances where, as the Claimants submitted, it had not been shown that full redress had been secured in Brazil. It was also insufficient to say the Claimants’ challenge to the unmanageability point was misconceived, without giving any reasons.

In terms of the jurisdictional abuse point, the Court expressed their concern about the brevity of Coulson LJ’s treatment of the points made in the grounds of appeal. However, what was more troubling was the fact that Coulson LJ did not squarely address the ground concerning Article 4 of Brussels Recast. The Court made plain that “it was not an answer to the argument that a claimant, who is not suing elsewhere, has the right to sue a defendant who can be properly served within the jurisdiction, to say that the proceedings are unmanageable or complex”.

Turning to the Article 4 and the Henderson points, the Court found that Coulson LJ did not engage with the points raised and “did not really grapple” with the argument that most Claimants had brought no other claims. The Court repeated that the unmanageability or complexity of the proceedings was not really an answer.

Consequently, the Court held that Coulson LJ failed fundamentally to grapple with the above points. As such, the application to re-open the decision under CPR 52.30 succeeded. The Court were further satisfied that permission to appeal should be granted.

Conclusion and analysis

This is a welcome decision from the Court of Appeal. It should not, however, be read as one suggesting that the Court of Appeal will be more open than before to re-open decisions to refuse permission to appeal. The circumstances in this particular case, as the Court stressed, were “truly exceptional’.

The Court interestingly gave some guidance to practitioners in terms of drafting of grounds of appeal, stating that the Court was often presented with lengthy and ill-focused grounds of appeal. It is worth noting this was given against a background in this case of the Claimants initially producing an eye-watering 39-page document, containing 15 draft grounds of appeal. The Court warned that the starting point must be for an appellant “to think through carefully what specific errors the court below is alleged to have made” and that the grounds must be short and separately numbered.

Time will tell if the appeal succeeds…

About the Author

Ranked by the Legal 500 2021 as a Rising Star, Dominique Smith was called in 2016 and has a busy practice in travel law. She undertakes work for both Claimants and Defendants in package travel claims, contractual disputes, and other related claims. Dominique has a particular interest in cross-border clinical negligence claims and regularly appears in the Coroners’ Courts.

 

Don’t Mention the Spanish Supreme Court to Ryanair

Last week the Spanish Supreme Court gave a detailed critique of Ryanair’s standard terms and conditions, finding them variously ‘vague’ and ‘abusive’. The criticisms made could equally well be levelled at the airline under our Consumer Rights Act 2015 and under Eurolegislation, and as such are instructive for English lawyers.

First, the Ryanair choice of law and jurisdiction clause, which reads:

“Except as otherwise provided by the Convention or applicable law, your contract of carriage with us, these Terms & Conditions of Carriage and our Regulations shall be governed by and interpreted in accordance with the laws of Ireland and any dispute arising out of or in connection with this contract shall be subject to the jurisdiction of the Irish Courts.”

The Spanish court held that this was ‘abusive’ and ‘incomplete’ because it gives consumers a misleading impression of their rights under most of the legislation relevant to potential claims against Ryanair (under, for example, the Montreal Convention or Denied Boarding Regulations, which contain their own applicable law and jurisdictional provisions, and under recast Brussels’ provisions on consumer contracts). It is quite difficult to argue with this analysis, and hard to justify the retention of the clause in the face of various authorities across the EU allowing for claims to be brought outside Ireland and under the law of the consumer’s home legal system.

Turning to the provision in Ryanair’s terms allowing for the airline to send passengers on one flight and their luggage on another ‘for safety or operational reasons’, the Supreme Court was equally unimpressed. Perhaps unsurprisingly, it declared the provision void by reason of vagueness and lack of specificity. Again, it is hard to imagine an English higher court coming to a different conclusion.

Then, the charge levied by the airline for reprinting a boarding pass – €40 – was held to be disproportionate; and its baggage fees were said to be both ‘abusive’ and ‘excessive’.

All in all, not a good day in court for Ryanair, whose additional charges and lack of customer service are a matter of some considerable notoriety across Europe. It remains to be seen whether the higher courts of other jurisdictions will follow suit; but this author would not be at all surprised if they did.

About the Author

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. Last year she was named Best Lawyers’ Travel Lawyer of the Year 2020/2021 and the Lawyer Monthly Women in Law Awards 2020: Personal Injury, and she has recently been invited to join the Consultative Group of Experts to the UNWTO Committee for the Development of an International Code for the Protection of Tourists and the Admiralty Court Users’ Committee.

…And Finally…

Those who know us well will be aware that the 1CL gin bottle is rarely out of circulation. And so it was with no degree of surprise at all that we read in Psychopharmacology of a joint study by Abertay University (Dundee) and London South Bank University, which found that those witnesses who had consumed alcohol were less confident and recalled fewer details than those who had not, but were no more likely to make errors. In other unsurprising news, the study found that people who discuss what they have seen with others can provide less reliable testimony. The researchers concluded that judges should be made aware that drunk people’s versions of events may not be less accurate than those of the sober. It’s all a question of degree, of course, but we felt we should make our readers aware of it in case they have any witnesses who might conceivably have had one or two cocktails before suffering a holiday accident (something not completely unheard of in our experience).

Written by or involving: Sarah Prager, Dominique Smith

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