15
Nov
21
Articles, Travel & Cross Border Claims
The Weekly Roundup: the International Competition Edition

It’s been an exciting week of sport, what with the T20 World Cup and the Autumn Internationals, and probably a bit of football too (there’s always football). But we at 1CL have been distracted from these events by a number of decisions on applicable law, jurisdiction and Covid related cancellations. We’ll bring you more on the latter topic next week, but for now, we commend to you two important decisions in areas presently subject to interesting development.

 

England v Ireland: Choice of Law in Convention Claims

The recent decision of Bernard Silverman v Ryanair DAC [2021] EWHC 2955 (QB) considered whether an airline can disapply its own choice of law clause, as well as how the Montreal Convention interacts with choice of law rules of the forum.

The facts

The Claimant entered into a contract with the Defendant to fly between East Midlands Airport, England and Berlin Schönefeld Airport, Germany. The contract contained a clause which stated the following:

Except as otherwise provided by the Convention or applicable law, your contract of carriage with us, these Terms and 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 Claimant duly arrived at the airport to embark upon the flight. However, whilst descending a set of stairs from the terminal on the way to the aircraft, the Claimant suffered a bodily injury. The Claimant thereafter pursued a claim against the Defendant in respect of his injuries.

The Defendant defended the claim on the basis that the injuries were not, for the purposes of the Montreal Convention, sustained in the course of embarking/disembarking the aircraft and were not as a result of an ‘accident’. Neither party disputed that the Montreal Convention applied. However, a preliminary trial before Master McCloud took place on the question of the applicable law.

The trial

The Claimant averred that liability for the accident was governed by the Montreal Convention. The Claimant submitted that the Convention was a complete code for governing liability, and it provided for matters of procedure to be governed by the law of the forum, but it provided nothing regarding how to approach the assessment of quantum. The Claimant submitted that the approach to quantum should be governed by the choice of law clause in the terms and conditions, namely Irish law. It was accepted that the clause in question did not expressly say Irish law applied to quantum or the interpretation of the Montreal Convention. However, the Claimant averred that the Montreal Convention made no arrangements for the assessment of damages or choice of law. This gave rise to an obvious answer on the issue as to how to approach the applicable law, namely, to apply the contractual choice of law clause, which would have the effect in this case of Irish law applying to the assessment of quantum. Further, the Claimant considered that Rome I applied, as there was an express carve out for contracts of carriage.

From the Defendant’s perspective, it was unusual that the accident happened in England, the loss itself was sustained in England, yet the Claimant sought to apply Irish law. The Defendant highlighted that the clause expressly stated: ‘except as otherwise provided by the Convention’. The Defendant argued that either the Montreal Convention specified the applicable law, or the applicable law was determined by the choice of law rules of the forum. Consequently, the Defendant averred that English law applied irrespective of the provisions in the terms and conditions. In the alternative, the Defendant argued that if it were wrong and the choice of law clause applied, the applicable law was Rome II, not Rome I.

Master McCloud noted there was no binding English authority dealing with these issues. However, there were two international authorities from the US Supreme Court that contained judgments by Justices Scalia and Bader Ginsburg. In Zicherman v Korean Air Lines Co 116 S Ct 629 (1996), Justice Scalia stated the following:

…the questions of who may recover, and what compensatory damages they may receive, were regarded [by the framers of the Warsaw Convention] as intertwined; and that both were unresolved by the Convention and left to “private international law”…

Having concluded that compensable harm is to be determined by domestic law, the next question to which we would logically turn is that of which sovereign’s domestic law… Choice of law is, of course, determined by the forum jurisdiction…

…Articles 17 and 24(2) provide nothing more than a pass-through, authorising us to apply the law that would govern in the absence of the Warsaw Convention.

Master McCloud considered that the Zicherman authority was the highest authority short of a Supreme Court domestic decision. Consequently, it was very persuasive, rather than in a strict sense being binding.  In her judgment, the lex fori’s choice-of-law rules applied to such matters here.

Master McCloud noted that the drafters of the Montreal Convention did not provide expressly for which law should apply to the interpretation of the Convention. However, she considered that the expressions ‘accident’ and ‘bodily injury’ must be interpreted in accordance with Convention law as understood by the Court, i.e. the lex fori in that rather special international sense. The fact that the Convention was incorporated contractually made no difference.

As such, the issue of whether Rome I or Rome II applied was only relevant to the aspects of the claim which were passed through to the domestic jurisdiction. Master McCloud considered that this claim fell within the provisions of Article 4(1) of Rome II. It was the Master’s conclusion therefore that the Convention governed liability and Rome II governed forum and choice of law where the Convention did not stipulate applicable law. However, the escape clause of Article 4(3) of Rome II could have the effect that where a contract for carriage is entered into prior to the tort or delict in question, the existence of a choice of law provision in that contract could be a basis for saying that the choice of law provision in the contract displaces the presumption under Rome I as to applicable law.

In this case, given that there was a choice of law clause in the contract of carriage and the airline was clearly connected with the jurisdiction in question, Article 4(3) was engaged and had the effect that for issues of cognisable damage and quantum, Irish law applied.

Conclusion

This is a slightly unusual case, with a judgment that in parts appears hard to follow. However, what is plain from the judgment is that Convention claims are governed by the applicable law as provided for in Rome II. From this author’s perspective, the analysis that Rome II applies, rather than Rome I, is unusual, and is not entirely convincing. However, whether the Defendant will appeal that point remains to be seen.

About the author

Ranked by the Legal 500 2021 and 2022 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.

 

England v Germany: Jurisdiction and Residence in the Absence of Physical Presence

In a recent decision in the High Court on appeal, Chowdhury v PZU SA [2021] EWHC 3037 (QB), Ritchie J considered the principles relating to a jurisdictional challenge made by the Defendant to a claim, in which it contested the jurisdiction of the courts of England and Wales on the basis that neither the Claimant nor the Defendant were domiciled within the jurisdiction for jurisdictional purposes.

The Application

Mr Chowdhury was a British national. At the time of the accident which was the subject of the claim he was working in England for a British company, but was on sick leave. On 27th August 2017 he was involved in a road traffic accident in Poland, liability for which was admitted on the part of the Polish road traffic insurer for the tortfeasor. In April 2018 Mr Chowdhury moved to Germany in order to receive medical treatment; in August 2020 he issued a claim seeking very significant damages directly against the insurer. The insurer duly challenged jurisdiction on the grounds that at the time the claim was issued the Claimant was not domiciled within the jurisdiction within the meaning of Article 62(1) of recast Brussels, which reads:

“In order to determine whether a party is domiciled in the Member State whose courts are seised of a matter, the court shall apply its internal law.”

The relevant statutory provision insofar as the courts of England and Wales are concerned is the Civil Jurisdiction and Judgments Order 2001 (SI 2001/3929), as amended. Insofar as it is relevant, pursuant to paragraph 9 of Schedule 1 to the Order:

“(1) …the following provisions of this paragraph determine, for the purposes of the Regulation, whether an individual is domiciled in the United Kingdom or in a particular part of, or place in, the United Kingdom or in a state other than a Regulation State…

(4) An individual is domiciled in a particular place in the United Kingdom if and only if he—

(a)is domiciled in the part of the United Kingdom in which that place is situated; and

(b)is resident in that place…”

The Facts

There was no question but that the Claimant had been resident in England and Wales until April 2018, when he had gone to Germany solely for the purpose of seeking medical treatment. He provided a comprehensive witness statement in which he stated that he intended to return to England as soon as his treatment was completed, and set out (and evidenced) his continuing ties to the jurisdiction:

  1. He was a British citizen;
  2. He had a UK passport;
  3. He was registered on the British electoral register;
  4. His family all resided in England, which was where his family home, most of his friends, and the vast majority of his belongings were located, some of them in storage for which he paid rather than moving them to Germany;
  5. He returned to England for four weeks in early 2020, and but for the current pandemic would have done so more latterly in 2020;
  6. He had a UK mobile phone number;
  7. He had a UK driving licence;
  8. He was registered on the UK organ donor register;
  9. He was a member of a UK union;
  10. His employer was registered in England;
  11. He was paid in England;
  12. He was taxed in England;
  13. His financial affairs were all based in England, which was where he held his investments;
  14. He had no German social connections and did not speak the language;
  15. He did not have a German visa or residence permit;
  16. He received UK disability benefits;
  17. His treatment was funded by the British NHS;
  18. He was planning to purchase a property in England.

The Submissions

Against this background the Claimant contended that he remained resident in England for jurisdictional purposes after April 2018, although he was not himself physically present within the jurisdiction.

The Defendant founded its challenge on the fact that the Claimant had not returned to the jurisdiction between April 2018, and had only done so for a matter of weeks in early 2020. He had therefore spent very little time in the jurisdiction in the last couple of years. It was submitted on the part of the Defendant that it was incumbent upon the Claimant to show that during this period he was resident at a particular address within the jurisdiction, whereas he could only show that he maintained a room in his parents’ house and a storage facility for his belongings; he had no family home or property of his own.

The legal framework was largely agreed between the parties. The relevant authorities were comprehensively reviewed most recently by Julian Knowles J in Sang Youl Kim v Sungmo Lee [2020] 8 WLUK 82, at paragraphs 31 to 49. At paragraph 41 the point was made that a party may have more than one residence; in that paragraph and at paragraph 42 there was reference to a ‘settled or usual place of abode’, ‘connoting some degree of permanence or continuity’; time spent in a particular jurisdiction ‘may or may not play an important part in determining residence’, depending on the facts of a particular case. At paragraph 43 the importance of the family home, and of the quality, rather than the quantity, of use of premises was emphasised.

The relevant principles were summarised at paragraph 44 (references are to defendants, but are equally applicable to claimants):

“(1) It is possible for a defendant to reside in more than one jurisdiction at the same time.

(2) It is possible for England to be a jurisdiction in which a defendant resides even if it is not his principal place of residence (ie even if he spends most of the year in another jurisdiction).

(3) A person will be resident in England if England is for him a settled or usual place of abode. A settled or usual place of abode connotes some degree of permanence or continuity.

(4) Residence is not to be judged according to a ‘numbers game’ and it is appropriate to address the quality and nature of a defendant’s visits to the jurisdiction.

(5) Whether a defendant’s use of a property characterises it as his or her ‘residence’, that is to say the defendant can fairly be described as residing there, is a question of fact and degree.

(6) In deciding whether a defendant is resident here, regard should be had to any settled pattern of the defendant’s life in terms of his presence in England and the reasons for the same.

(7) If a defendant visits a property in England on a regular basis for not inconsiderable periods of time, where his wife and children live, in order to see his wife and children (including where the centre of the defendant’s relationship with his children is England), such property has the potential to be regarded as the family home or his home when in England, which itself is evidence which may go towards supporting the conclusion that England is for him a settled or usual place of abode, and that he is resident in England, albeit that ultimately it is a question of fact and degree whether he is resident here or not, having regard to all the facts of the case including any discernible settled pattern of the defendant’s life or as it has also been put according to the way in which a man’s life is usually ordered.”

The Judgment at First Instance

On 5th January 2021 Master Brown gave judgment in favour of the Claimant, dismissing the jurisdictional challenge and refusing the Defendant permission to appeal. In doing so he found that it was unnecessary for jurisdictional purposes for the Claimant to prove that he was resident at a particular address within the jurisdiction; he need only prove that he had not abandoned his residence within England and Wales when he went to Germany for treatment. The judge found that he had not done so. Although it was true that he had not spent substantial periods of time within the jurisdiction between April 2018 and August 2020, this was only one factor to be weighed in the balance; and it was relevant that initially he had suffered from psychological sequelae which had prevented him from flying, and more latterly he had been prevented from travelling from Germany to England as a result of the measures taken in response to the Covid-19 pandemic. He had not chosen to remain in Germany, and his intention to return to England following treatment was a factor to be weighed against his physical presence in Germany. On the evidence, he had not severed his connection with the jurisdiction such that it could be said that he was no longer resident within England and Wales.

The Defendant appealed on the grounds that Master Brown had been wrong to find that it was not necessary for the Claimant to prove that he was resident at a particular place within the jurisdiction, and on a number of other grounds, including the relevance of and weight to be given to unrealised intention to return to the jurisdiction.

The Judgment on Appeal

Ritchie J upheld the Master’s decision on appeal. In doing so, he relied on the following principles, distilled from the authorities provided to him:

  1. The words “resident in” are given a plain and normal meaning.
  2. All of the relevant factual matrix is taken into account.
  3. No one factor trumps all others.
  4. A person can reside in two or more places at any one time, so residence is not exclusive.

He reminded himself that:

“Residence in England is not lost merely by reason of travel, even long duration travel, due to work.”

Furthermore,

“Mere ownership of property is not determinant.  So the obverse must be true, mere lack of ownership of property does not abolish residence in England.”

As a result, so the judge found, there is no threshold requirement for a person to have a property right within the jurisdiction in order for him to be resident here.

Analysis

The judgment reiterates the principle emphasised in all of the authorities on residence that it is not what is referred to as a ‘numbers game’; whether or not a party is resident within the jurisdiction cannot be determined solely by an assessment of how many days per year he or she spends here, particularly where, as recently, there is good reason for presence or absence. It is also important to bear in mind the reason for presence or absence in a particular jurisdiction; as in the case of Panagaki v Apostolopoulos [2015] 5 WLUK 332, the fact that a party seeks medical treatment at a particular facility may contraindicate an intention to reside in that country for jurisdictional purposes.

Interestingly, the Claimant need not prove as the foundation for his residence within the jurisdiction that he has any property interest; as Ritchie J found:

“ownership of property is not the determinant of residence and I so rule. Travellers (the Travelling Community) do not own real property (bricks and mortar). Nor do the homeless. Both are equal under the law with all others in relation to domicile.”

The author respectfully agrees with this analysis; it cannot, it is suggested, be the case that in order to prove residence for the purposes of exercising jurisdictional rights a person must point to a particular address within the jurisdiction. Otherwise a homeless person born and bred in England, and who has never left the jurisdiction and has no intention of doing so, would be left without the rights and obligations that residence within the jurisdiction confers. This result cannot be right; it cannot be the case that a party must meet a threshold requirement of showing that (s)he resides at a particular address before residence will be considered to have been proven.

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 completed work for the UNWTO on an International Code for the Protection of Tourists. She is a member of the Admiralty Court Users’ Committee. She undertakes purely domestic high value personal injury work as well as cross border work and has a wealth of experience of difficult and sensitive cases.

 

…And Finally…

As anticipated, last week’s webinar on data protection was a rip-roaring affair attended by everyone who’s anyone in the Travel World and beyond; if you missed it, it’s available on the 1CL youtube channel, along with recordings of the other webinars in the series. If you’re quick, you can register to attend the next in the series, on Material Contribution and Causation, here – but it starts at noon today, so best get in quick.

Written by or involving: Sarah Prager, Dominique Smith

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