Should England and Wales be rebuttably presumed to be the forum conveniens once a jurisdictional gateway has been satisfied?

3 April 2023
London International Disputes Week
Should England and Wales be rebuttably presumed to be the forum conveniens once a jurisdictional gateway has been satisfied?

Author: Rupert D’Cruz and Adam Greaves

  1. Introduction

Common law jurisdictions, such as England and Wales, are home to the forum non conveniens principle. The court, even with jurisdiction, has the discretion to decline to exercise it because another foreign jurisdiction is the ‘more convenient’ forum to hear the dispute.

When the UK was still part of the EU, the principle was partially inhibited where the English courts’ jurisdiction was founded on the Brussels Regulation (and subsequently the Re-Cast Regulation). This was because it defeated the idea of a single internal market and created legal uncertainty as to allocation of mandatory jurisdiction among the EU Member States’ courts. Therefore, the default position (under Article 4 of the Re-Cast Regulation) was that where the Defendant was domiciled in a Member State court, that court would have jurisdiction over a claim against the Defendant.

The popularity of the UK as ‘a second home’ for high-net-worth individuals meant that, as a result, many high value claims were commenced in the English courts under Article 4.

Following Brexit, the UK withdrew from the Re-Cast Regulation, and so for jurisdictional challenges made after 31st December 2021, the old common law principle once again applies to its fullest extent. The law is today as it was in 1987, as set out by Lord Goff in Spiliada:

Limb 1

The applicant must establish:

  • that another forum has jurisdiction to hear the claim – known as ‘availability’; and
  • an available Court is a more appropriate forum in which to hear the claim.

Limb 2

  • that the applicant will obtain justice in that more appropriate forum.

Once the applicant has established that limb 1 is satisfied, the burden of proofs falls on the respondent to show why “justice nevertheless requires that a stay of the English proceedings should not be granted”.

This article explores the possibility of reshaping the principle to strengthen England and Wales’ position as the go-to jurisdiction for resolving complex commercial disputes to ‘regain’ some of the cases that been ‘lost’ now that Article 4 no longer applies.

  1. Why change?

In October 2022, jurisdictional gateways under the CPR have significantly expanded, such as those in relation to trusts, contracts and economic torts. Hence, there are greater chances for claimants to commence civil litigation against foreign defendants in England and Wales.

However, the proliferation of service out grounds must be accompanied a readiness of the English courts to accept jurisdiction and not to render the claims issued here futile.  Furthermore, due to the increasing decentralisation of business relations nowadays, disputes have become fragmented with connecting factors evenly scattered across the globe. We believe that the English courts should recognise this through a less stringent application of the forum conveniens principle.

  1. Recent case law on forum non conveniens

In Al Assam and others v  Tsouvelekakis  and Others [2022] EWHC 451 (Ch) the court had to decide whether Cyprus and England was the most appropriate forum to hear this dispute.

The case concerns failed investments in Cypriot companies conducting businesses in Greece. The parties (Dubai and Cyprus-domiciled settlors and beneficiaries of two Cypriot trusts, offshore asset-holding special purpose vehicles, and an English investment advisor) agreed that, among the six claims, four fell to be decided under Cypriot law and two under Swiss law. The claimants anticipated that evidence from English-speaking experts. Most witnesses speak English, but the trial will likely involve interpreters. Due to the complexity of the case, the defendant requested that the English court decline jurisdiction and permanently stay the proceedings for Cyprus was the more appropriate forum.

Under Spiliada, once jurisdiction has been established as of right, it should not be taken away unless there is a clearly more appropriate forum. Because the defendant resides in England, the claimants served him as of right. Jurisdiction was properly founded for that reason. While numerous factors did point towards Cypriot courts, they did not outweigh the significance of a properly founded claim.

In another case, Charlton v Deffert [2022] EWHC 2378 (KB), the court held that service on a solicitor in England and Wales was effected in accordance with CPR 6.7. Therefore, it amounted to service “as of right” and so the appropriate forum conveniens test was for the defendant to establish that there is another available forum which is clearly or distinctly more appropriate than the English forum.

The Master considered various factors relevant to determining that the defendant had satisfied the relevant test. In short, England and Wales is the location of all the quantum witnesses, the damage in question, and the tax system in question.

  1. Proposed changes to the forum non conveniens tests

To simplify matters, we believe that the rules should be changed, so that once at least one of the jurisdictional gateways has been established, there is a presumption that the court will take jurisdiction, which would only be rebutted if it would be manifestly inappropriate to do so (“the Rebuttable Presumption”).

This would have two effects. First, the burden of proving the opposite would fall back on the party challenging the jurisdiction (reversing the burden in Spiliada). Second, in the absence of it being manifestly inappropriate, succeeding in at least one gateway would trump the satisfaction of the Limb 1 tests in Spiliada. The result, we believe, would be English courts accepting many of the cases that once came before it under Article 4.

Lessons can be learned from the VTB decision and the Australian approach to forum non conveniens.

In VTB Commodities Trading DAC v JSC Antipinsky Refinery & Ors [2021] EWHC 1758 (Comm) the court and the parties accepted that there were significant factors pointing to Russia being the forum conveniens, such as the location of the parties (mostly Russian businesses), the relevant events (relating to a Russian oil refinery), the witnesses (mostly in Russia), the documents (predominantly located in Russia and often in the Russian language), and the existence of complex Russian law issues.  On the other hand, the connections with England were “virtually non-existent“.

The court explored whether or not another case, the “Cargo Trial”, acted as a trump card necessitating England as the forum conveniens, given the desirability of hearing all related claims in one forum.  The court recognised that there was only a limited overlap between the claims.

The court concluded that the “Cargo Trial” was not a trump card and the risk of irreconcilable decisions across multiple proceedings could only be a factor to be considered alongside other relevant factors.

Having weighed the various factors in favour of Russia as the forum conveniens, the court found that the factors in favour of Russia were “so heavy” that only Russia could be the forum conveniens; even if it had reached a different decision on the use of the Part 20 procedure, it would have concluded that the burden of establishing that England was “clearly and distinctly” the most appropriate forum had not been discharged. The decision would, in all likelihood, have been different if the Rebuttable Presumption principle applied.

This judgment also provides a useful insight into the court’s approach to the risk of irreconcilable decisions arising from parallel proceedings.  Parties should remember that it is only one of the factors to consider, but not a trump card.

In Australia, due to a mixture of common and statute law, the approach varies from a clearly inappropriate forum test to a more appropriate forum test depending on the circumstances. The more appropriate forum test applies to transfers of proceedings within Australia or to stays of proceedings in favour of the New Zealand courts, whereas the common law test applied in respect of most other overseas courts permits a stay on forum grounds only if the Australian court is a ‘clearly inappropriate forum’.

Where the clearly inappropriate forum test is applicable, the Australian courts consider (i) the right of the plaintiff to choose their forum, (ii) whether the litigation is vexatious or oppressive, (iii) whether there is an abuse of processes, (iv) whether there are parallel proceedings already commenced abroad, and (v) connecting factors including the availability of witnesses and evidence.

While the clearly inappropriate forum test is technically available to stay proceedings concerning an Australian-registered company, competence is only ever established by service within the relevant state or by submission to the jurisdiction of that state’s courts. Therefore, the almost inevitable – although not the necessary – outcome is that an Australian court will not be considered a clearly inappropriate forum to hear an action taken against an Australian-registered corporate defendant.

  1. Would this work in England and Wales?

The short answer is yes.  The Rebuttable Presumption approach we propose enhances procedural economy by eliminating protracted arguments under Limb 1.  It goes straight to what the court is most concerned, i.e. access to justice, which is the cornerstone of the natural forum analysis in the English legal tradition.

This proposed change will not only benefit the claimants, but also the defendants, who often have a transnational and/or blockchain presence. Since the determination of the availability and appropriateness of the foreign forum is non-determining by nature, the Rebuttable Presumption approach will allow these defendants to focus on addressing the more important issue of fairness, hence saving unnecessary time and costs.

After all, defendants having just the remaining Limb 2 to argue will not be prejudiced. Forum non conveniens arguments are determined on a case-by-case basis. In any event, even if the English court ultimately decides that it is the more convenient forum, businesses and corporations can rest assured that their cases will be adjudicated fairly in this jurisdiction due to its long-standing reputation as a neutral and commercially driven dispute resolution hub.


Rupert D’Cruz

Rupert D’Cruz is a King’s Counsel specialising in complex cross-border litigation and arbitration. Through years of experience working across the CIS/FSU region, Rupert has developed a niche expertise in CIS/FSU-related disputes that is consistently recognised by the leading directories.

Adam Greaves

Adam Greaves is a leading commercial litigation and arbitration practitioner who focuses principally on cross-border disputes. Adam’s expertise includes post M&A claims, shareholder disputes, civil fraud and asset tracing claims, and professional negligence. In the past 30 years Adam has worked on some of the largest fraud cases brought in the commercial court in London. Adam also advises clients on the Bribery Act 2010 and has worked on investigations brought by the US DOJ or the SEC under the US Foreign Corrupt Practices Act.