Zona Gastronomica SLU and Others v Carbon Finance Ltd and Others

 
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[2015] IECA 93

THE COURT OF APPEAL

Kelly J.

Peart J.

Mahon J.

Appeal Nos. 444/2014
446/2014
447/2014
O'Flynn & Ors v Carbon Finance Ltd & Ors
Michael O'Flynn and John O'Flynn, Brabston Limited, Broomco (4102) Limited, Cesium Limited, Coleridge International Limited, Crestor Limited, Deanshall, Dellacourt Limited, Eastgate Developments (Cork), Fairbury Unlimited, FTG Projekt Kerpen GMBH & Co. KG, Galileo Residenz Bremen Gmbh & Co. KG acting by its general partner Galileo Residenz GMBH, Graiguemore Limited, Jelton Limited, Lamada Limited, Little Island Property Limited, Magnum Freeholds Limited, Magnum Property Nominees 15 Limited, Medallion Investment Limited, Millington Properties Limited, O'Flynn Construction (BTC) O'Flynn Construction (Lapps Quay), O'Flynn Construction (Rochestown), O'Flynn Construction (Technology Park), O'Flynn Construction Co., O'Flynn Construction Holdings, Precis (2111) Limited, Precis (2110) Limited, Precis (2102) Limited, Precis (2103) Limited, Precis (1672) Limited, Precis (2175) Limited, Precis (2176) Limited, Precis (2112) Limited, Residencias Universitarias, SA, Rose Castle, Sentinel Number Two Limited, Shelbourne Senior Living Limited, Tiger Atrium Limited, Tiger Bremen One GMBH, Tiger Bremen Two GMBH, Tiger Cowley Limited, Tiger Developments, Tiger Developments Gmbh & Co KG. Tiger Developments (Jersey) Limited, Tiger Guildford Limited, Tiger Hannover Gmbh & Co. KG, Tiger Harbour Island Limited, Tiger Haymarket Limited Partnership, Tiger 4 Limited, Tiger 55 Limited, Tiger 130 Limited, Tiger (Dominion) Limited, Tiger Haymarket No. 1 Limited (As General Partner For Tiger Haymarket Limited Partnership), Tiger (IOM) Limited, Tiger (Retail Dominion) Limited, Tiger No. 1 General Partner Limited for itself and as General Partner of Tiger No. 2 Limited Partnership, Tiger No. 1 Limited Partnership A Limited Partnership Established Under The Limited Partnership Act 1907, Tiger No. 2 General Partner Limited For Itself AND as General Partner of Tiger No. 2 Limited Partnership, Tiger No. 2 Limited Partnership a limited Partnership Established Under The Limited Partnership Act 1907, Tiger No. 5 Limited, Tiger Properties Limited, Tiger St. Michael's Limited, Tiger Teesdale Limited, Topwell No. 1 Limited, Topwell No. 2 Limited, Topwell No. 5 Limited, Topwell No. 6 Limited, Magnum Property Nominees 3 Limited, Magnum Property Nominees 4 Limited, Magnum Property Nominees 14 Limited, Magnum Property Nominees 16 Limited, Magnum Property Nominees 43 Limited, Godalming Trustee Company Limited, Tiger Enterprise No. 2 Limited, Stockley Park Trustee Company Limited, Stockley Park Trustee Company No. 2 Limited, The Livingstone Trustee Company Limited, Livingstone Trustee Company No. 2 Limited, Valdes Property Limited, Victoria Hall Construction Limited, Victoria Hall Limited, Zona Gastronomica SLU
Plaintiffs

and

Carbon Finance Limited Paul McCann, Patrick Dillon, Mark Byers, Marcus Wide and the Blackstone Group LP and the Blackstone Group International Partners LLP
Defendants

2014/444, 2014/446 & 2014/447 - Kelly Peart Mahon - Court of Appeal - 19/2/2015 - 2015 IECA 93

Appeal – Rules of the Superior Courts – Jurisdiction Clauses – Damages – Abuse of Process – Practice and Procedures – Liberty – Summons – Justice – Conspiracy – Breach of Contract

Facts: On the 24th day of November 2014, the court dismissed three separate appeals from orders made by McGovern J. in the High Court Commercial Division. One appeal was taken by the plaintiff and the others by the first and seventh and sixth defendants respectively. The plaintiff appealed against an order made by McGovern J. in the Commercial Court in which he acceded to an application made by the first, sixth and seventh defendants and struck out that part of the plaintiff”s claim which related to five group facility agreements each dated the 28th February, 2013, which were subject to an exclusive jurisdiction clause in favour of the Courts of England. The application was brought pursuant to O. 19, r. 27 of the Rules of the Superior Courts and the inherent jurisdiction of the court. The first and seventh defendants also sought to challenge that part of the order of McGovern J. of 6th October 2014, where he refused to strike out the plaintiffs” claims for conspiracy, and causing damage by unlawful means, inducement of breach of contract and interference with contractual relationships, pursuant to O. 19, r. 5 and/or O. 19, r. 27 of the Rules of the Superior Courts. The final appeal was one brought on behalf of the sixth named defendant, The Blackstone Group L.P. against the order of McGovern J. when he refused that defendant”s application to set aside an ex parte order made by O”Malley J. on the 26th August 2014 insofar as same gave liberty to issue a Concurrent Summons in respect of the sixth named defendant, and to serve notice of same on that defendant outside the jurisdiction under the provisions of Order 11, rule 1 RSC.

Held by the Court in light of the available evidence and submissions presented that McGovern J. had been justified in concluding that the first defendant was entitled to rely upon the choice of jurisdiction clause notwithstanding the entry of an unconditional appearance to the summons. He did so in circumstances where he held that it was by no means clear that the proceedings encompassed agreements some of which were subject to English law and English jurisdiction clauses at the time that that appearance was entered. It was reasoned that, in this case, there was no evidence of an express waiver on the part of the first defendant of its entitlement to rely upon the exclusive jurisdiction clause. The elements identified as constituting an implied waiver neither individually or collectively came anywhere near discharging the onus of proof which would be required in order to succeed in such a claim. It was for those reasons that that appeal was dismissed. In respects of the first and seventh defendants appeal the Court was satisfied that the plaintiffs had furnished such particulars as could reasonably be expected at that stage of the proceedings given the nature of the allegations made and the circumstances of the case. It followed that they were not in breach of their obligations and for those reasons that appeal was dismissed. In respects of the sixth named defendant, the Court was satisfied that the order made by O”Malley J. on 26th August 2014 should not be discharged, and Blackstone”s appeal against the order of McGovern J. dated 7th October 2014 was dismissed.

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Judgment of the Court delivered on the 19th day of February 2015,

Introduction
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1. On the 24 th day of November 2014, the court dismissed three separate appeals from orders made by McGovern J. in the High Court Commercial Division.

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2. One appeal was taken by the plaintiff and the others by the first and seventh and sixth defendants respectively.

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3. The court indicated that it would give its reasons for dismissing the appeals at a later date which it now does in this judgment.

Part A
The Plaintiffs' Appeal
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4. This is the plaintiffs appeal against an order made by McGovern J. in the Commercial Court in which he acceded to an application made by the first, sixth and seventh defendants and struck out that part of the plaintiff's claim which related to five group facility agreements each dated the 28 th February, 2013, which were subject to an exclusive jurisdiction clause in favour of the Courts of England. The application was brought pursuant to O. 19, r. 27 of the Rules of the Superior Courts and the inherent jurisdiction of the court.

The Jurisdiction Clauses
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5. Whilst eight corporate facility agreements are impleaded, the five which are the subject of the order under appeal, all contain the following clause:-

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2 "40.1 Jurisdiction

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(a) The Courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this agreement (including a dispute regarding the existence, validity or termination of this agreement).

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(b) The Parties agree that the Courts of England are the most appropriate and convenient courts to settle disputes and accordingly no party will argue to the contrary.

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(c) This clause 40.1 is for the benefit of the finance parties and the secured parties only. As a result, no finance party or secured party shall be prevented from taking proceedings relating to a dispute in any other courts with jurisdiction. To the extent allowed by law, the finance parties and the secured parties may take concurrent proceedings in any number of jurisdictions."

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6. In Kutchera v. Buckingham International Holdings Limited [1988] I.R. 61 , McCarthy J. identified the proper approach which courts ought to have to a choice of jurisdiction clause. He said:

"The correct legal principle is that the parties' choice of jurisdiction should be upheld and the necessary procedural orders granted unless there are strong reasons to the contrary."

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Later in the judgment he said:

"It must be the policy of...

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