The Schedule 4 rules: interpretation and operation in Lugano cases

The rules set out in Schedule 4 to the 1982 Act, as amended and re-amended, are rules of internal United Kingdom law. As such, their interpretation was not a matter upon which the European Court had competence, for they are not rules of European law. Neither, as it was held, was it open to a court in the United Kingdom, even though an interpretive ruling on a corresponding provision of the Lugano/Brussels instruments would be of assistance in its interpretation of Schedule 4, to make a request for such a ruling, for the provision of European law on which a ruling was sought was ex hypothesi inapplicable to the case before the national court.^[1]

Prior to Completion Day, United Kingdom law provided that the provisions in Schedule 4 were to be interpreted with regard to the jurisprudence of the European Court on the Lugano/Brussels instruments. After Completion Day, the English courts will continue to interpret the provisions of Schedule 4 by having regard to any relevant principles laid down by the European Court, or decisions made by the European Court, before Completion Day. The temporal limitation appears to be a matter of posturing rather than substance.

If the Lugano Convention were to allocate jurisdiction to the courts of a single place within the United Kingdom, which means upon the courts for a particular part of the United Kingdom, the Convention will have determined international and national jurisdiction, and there is no more to be said about it: the rules in Schedule 4 will not be needed. In particular, the courts of the part identified will have no power to apply principles of forum non conveniens in favour of the courts of another part of the United Kingdom which, ex hypothesi, do not have such jurisdiction, for that would be to undermine or contradict the effect of the Convention.

By contrast, where the Lugano Convention has the effect of allocating jurisdiction to the courts of two parts of the United Kingdom - say in a tort case the defendant is French, the damage occurs in England and the event giving rise to it was in Scotland -then as the rules of lis alibi pendens in the Convention itself are inapplicable (there being proceedings before only one Lugano State), and as these rules are not replicated within Schedule 4, an English court may use the principle of forum non conveniens to allocate jurisdiction to the United Kingdom court having jurisdiction according to the Convention which is best placed to determine the matter.

The Schedule 4 rules: interpretation and operation in non-Lugano cases

As has been explained, the Lugano Convention, like the Brussels instruments, is not designed to apply, and does not apply, to proceedings in a civil or commercial matter which is wholly internal to a single Lugano State. If the case is not one which concerns the international jurisdiction of the courts of the United Kingdom, the Convention does not apply to the case. This will typically be the case where both parties are English, or a Scottish claimant wishes to sue an English defendant, and so on.

In such circumstances, the only jurisdictional issue is as to the part of the United Kingdom whose courts have national or internal or local jurisdiction. For example, when Kleinwort Benson Ltd, an English merchant bank, sought to sue Glasgow City Council for the return of money paid under an elaborate financial agreement which had wrongly been supposed to be valid but which had been void since before the ink was dry on the paper, Section 16 of the 1982 Act, and therefore Schedule 4 to the Act, was the legislative text which determined whether the claim could be brought in the English courts, or was required to be brought in Scotland.^[2]

In a civil or commercial matter, in which the defendant is domiciled in the United Kingdom, but no question of international jurisdictional arises, the issue is simply one of internal United Kingdom law, this law being set out in Schedule 4. In this context, the right of the courts of the United Kingdom to exercise their traditional forum non conveniens discretion as between themselves will continue to be applicable, because the jurisdictional question which arises for answer is now one of internal United Kingdom law of which this is a part. If, for example, the case involves two United Kingdom parties, one with a domicile in England and one in Scotland, an English court would be entitled to stay proceedings brought before it in favour of the Scottish courts, if it were to find that the Scottish courts had jurisdiction under Schedule 4 and to consider that Scotland was the forum conveniens. If the Lugano Convention does not apply, and if the Scottish courts would have jurisdiction under the Schedule 4 rules, there would be no impediment to the application of the principles of forum non conveniens.

• [1] C-346/93 Kleinwort Benson Ltd v City of Glasgow DC [1995] ECR 1-615. The unhelpfulness of the European Court in this case stands in sharp contrast with its attitude to references made by national courts in other countries whose reason for a reference was even more tangential than that of the English court. 2 Civil Jurisdiction and Judgments Act 1982, Section 16. 3 SI 2019 No 479, Reg. 28(5) (inserting Subsection (3A) into Section 16 of the 1982 Act). 4 Cook v Virgin Media Ltd [2015] EWCA Civ 1287, [2016] 1 WLR 1672; Kennedy v The National Trust for Scotland [2019] EWCA Civ 648, [2020] QB 663; see para. 5.05, above. 5 This establishes the case as an international one, making the Convention applicable. 6 Cook v Virgin Media Ltd [2015] EWCA Civ 1287, [2016] 1 WLR 1672; Kennedy v The National Trust for Scotland [2019] EWCA Civ 648, [2020] QB 663.
• [2] Kleinwort Benson Ltd v City of Glasgow DC [1999] 1 AC 153. 2 The Act does not use this term, but it is useful and accurate at this stage of the analysis. 3 The Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019, SI 2019 No 479, Reg. 26. 4 Section 15E(2).