Injunction to restrain equitable wrong: vexatious or oppressive conduct by invoking foreign procedural laws
Seeking to obtain evidence by recourse to the civil procedures of a foreign court, for use in English proceedings which were already underway, was held in South Carolina Insurance Co v Assurantie Maatshappij ‘de Zeven Provincieri TVL not to amount to a wrongful interference with the jurisdiction of the English court. Obtaining evidence in a country by means which were available under the law of that country was thought not to interfere with or undermine the jurisdiction of the English court; the procedures were not unconscionable simply because they increased the costs burden upon the applicant.
Maybe so; but there are good reasons to reconsider. There have been and will be cases where the foreign procedures invoked - for example, subjecting of potential witnesses to the taking of depositions close to the beginning of the English trial -has too disruptive or distorting an effect on the English jurisdiction to be condoned. Indeed, it is not clear why it would not be seen as oppressive, or an interference with the jurisdiction, to allow depositions to be ordered or obtained in a foreign jurisdiction for use in local proceedings. English law does not allow oral discovery; to permit it to be obtained may be too greatly to affect the balance between the parties to an English trial. In South Carolina, the respondent, who had formerly sought both oral and documentary discovery, had abandoned any claim to the former by the time the case came to the House of Lords. It may therefore be possible to read too much into the refusal of the House of Lords in that case to order an injunction.
Some decisions have shown a greater preparedness to see steps taken in a foreign court as wrongfully encroaching on the jurisdiction of the English court; this is to be welcomed. In Omega Group Holdings Ltd v Xbze/y?, an injunction was ordered to restrain the taking of depositions in the United States, on the basis that the witnesses to be deposed were liable to be cross-examined in the English proceedings, and it was, therefore, unconscionable to expose them to what was, in effect, double cross-examination. In Glencore International AG V Metro Trading International Inc,'52 where a vast piece of commercial litigation was under close and active case management by the Commercial Court, an injunction was ordered to restrain an action brought in the United States which had or would have the effect of interfering with the proceedings before the Commercial Court, and which would have created a great burden in additional costs. Where a matter is under active case management by the English court, anti-suit injunctions granted by way of protecting this scheme of early case management will become a more frequent phenomenon;[1] but where the English court is not involved in the same way, it will adopt a more laissez-faire approach.
Injunction to restrain equitable wrong: vexatious or oppressive conduct by wrongfully undermining an English judgment
Vexatious or oppressive behaviour may be demonstrated by taking steps to undermine the conclusiveness of an English judgment.
In Masri V Consolidated Contractors International (UK) Ltd (No 3)' it was held that a defendant who had submitted to the jurisdiction of the English courts, and had been ordered to pay damages, was liable to be restrained by injunction from bringing proceedings before a foreign court, where it feared that enforcement against its assets might be sought, for a declaration that it owed no liability to the judgment creditor. The precise ground on which this was to be done was a little unclear, but the best reading of the judgment is that by submitting to the jurisdiction of an English court, and seeking substantive relief in the proceedings, the respondent had assumed an obligation to abide by and obey the judgment, and to seek to underline or annul this judgment by mounting what was, in effect, an extra-curial appeal against it or its conclusiveness, was wrongful and liable to restraint.
The court suggested that the injunction protected the jurisdiction of the English court which was not spent once it had given judgment. At first sight, this is not as persuasive as the explanation that it is oppressive to re-litigate the merits of a claim which has already been fought to judgment. This explanation is founded on the behaviour of the judgment debtor and respondent as being (equitably) wrongful. If this is correct, it will be legitimate to ask the courts at the place where enforcement is anticipated to find that the judgment is not enforceable under their rules of private international law, but to ask them to re-try the merits would be as objectionable after the first trial as would be parallel litigation during it.[2] The case is a good illustration of the proposition that the grounds on which an injunction can be obtained overlap.
The approach of the court in Masri is to be contrasted with ED & F Man (Sugar) Ltd v Haryanto (No 2),'si in which the objection was to the undermining of a settlement of English proceedings. A dispute between an Indonesian citizen, Haryanto, and an English corporation was settled after proceedings had been commenced in the English courts. Some time after, Haryanto sued in Indonesia and obtained a judgment annulling the underlying contracts in respect of which the English proceedings had been brought, and the settlement. The corporation then sought an injunction to restrain Haryanto from relying, anywhere in the world including Indonesia, upon his Indonesian judgment. The Court of Appeal held that the later Indonesian judgment was not entitled to recognition in England, but beyond that it would not be unconscionable for Haryanto to rely upon his Indonesian judgment in Indonesia, or anywhere else where he was entitled to do so. The settlement agreement contained no express term15’ that proceedings would not be taken elsewhere to challenge it, so the company had no legal right not to be sued in Indonesia. Neither was it unconscionable for Haryanto to use the civil procedure of other countries in aid of his cause. In the light of Aerospatiale, the Court of Appeal may have paid too little regard to the possibility of proceedings having to be fought and defended by the English company in third countries, but the case was, as Neill LJ admitted, ‘very difficult’. It is not clear that it was: one asks whether Haryanto committing a wrong. If, as the court concluded, he had not bound himself not to challenge the settlement, and as there was no English judgment to undermine, he committed no wrong: not cricket, perhaps, but not a wrong a court could point to. The distinct issues raised by the prospect of an injunction to prevent enforcement of a foreign judgment, as a separate and distinct category, are considered below.
The fact that the foreign proceedings may result in a judgment which will deal with issues which had been decided in a prior English judgment does not by itself make it vexatious to bring the proceedings before the foreign court: the question is whether it is wrongful for the foreign proceedings to have been brought, and it may not be. In Seismic Shipping Inc v Total E & P UK PlcM a decree limiting a shipowner’s liability had been obtained from an English court, but an attempt to obtain an injunction to restrain substantive proceedings before the Texas courts failed, on the approximate ground that the respondent, claiming in Texas, was doing nothing wrong. He had not claimed in the English proceedings, had not contractually agreed to the exclusive jurisdiction of the English courts, and had a good claim under the law of Texas. Leaving aside the effect this might have on the limitation decree, he had done nothing which could remotely be described as unconscionable. The fact that an English court had limited liability by decree did not make the Texas action wrongful; the Texas action did not undermine the jurisdiction of the English court or demonstrate wrongful behaviour by the claimant; it could not be correct that an injunction could be obtained every time there was a risk that a foreign judge would say something inconsistent with what an English court had already decided. It would, of course, be for the Texas court to decide for itself what to make of the English limitation decree, which is precisely how private international law is supposed to work.
- [1] [2002] EWCA Civ 524, [2002] 2 All ER (Comm) 1. Followed and applied in Benfield Holdings Ltd v Richardson [2007] EWHC 171 (QB). 2 On injunctions granted to protect the jurisdiction of an English court to rule on its own jurisdiction, see Tonicstar Ltd v American Home Insurance Co [2004] EWHC 1234 (Comm), [2005] 1 Lloyd's Rep IR 32. This sits uncomfortably alongside cases in which an English court states that an injunction when granted by it does not interfere with the foreign court or its procedure. 3 Dreymoor Fertilisers Overseas Pte Ltd v Eurochem Trading GmbH [2018] EWHC 2267 (Comm) (no injunction; evidence being gathered for trial in BVI; pending arbitration in England not really affected). 4 [2008] EWCA Civ 625, [2009] QB 503. 5 It may be that this was also said to try to forestall any objection, derived from the Brussels I Regulation, that the court was no longer seised of the dispute, and that any post-judgment proceedings needed to be independently justified on jurisdictional grounds provided for by the Regulation. The issues will be identical for the Lugano Convention.
- [2] This distinction will be more difficult to defend if the foreign system’s rules for the recognition of foreign judgments does involve some re-examination of the merits, but that should not call into question the proposition in the text. 2 [1991] 1 Lloyd’s Rep 429. 3 And none was to be implied. That looks like a failure of drafting. 4 Paragraphs 28.16-28.17. 5 [2005] EWCA Civ 985, [2005] 2 Lloyd’s Rep 359. 6 Under Merchant Shipping Act 1995.
