Aquila WSA Aviation Opportunities II Ltd v Onur Tasimacilik A.S.
| Jurisdiction | England & Wales |
| Judge | Sara Cockerill |
| Judgment Date | 12 April 2017 |
| Neutral Citation | [2017] EWHC 1259 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 12 April 2017 |
| Docket Number | Case No: CL-2016-000783 |
[2017] EWHC 1259 (comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
7 Rolls Building
Fetter Lane
London
EC4A 1NL
Sara Cockerill QC
(Sitting as a Deputy Judge of the High Court)
Case No: CL-2016-000783
Mr David Caplan (instructed by White & Case) appeared on behalf of the Claimant
Mr Stephen Cogley QC and Miss Heather Murphy (instructed by Freeths) appeared on behalf of the Defendant
(As Approved)
THE DEPUTY JUDGE: This matter concerns a jurisdictional challenge brought by the defendant and answering application brought by the claimant to sustain jurisdiction. The claimant is an Irish asset finance company. It leases aircraft and aircraft engines. The defendant is a Turkish company, which operates scheduled commercial airline services within Turkey, Europe and Asia. It has its registered office at Istanbul Atatürk Airport in Istanbul, Turkey.
The claimant and defendant entered into a lease agreement for an aircraft engine on 11 September 2015. The Lease consists of the IATA document 5–1601 Master Agreement and specifically agreed modifications to that Master Agreement. The Lease has a non-exclusive jurisdiction clause in favour of England.
For present purposes, the key clause of the Lease is clause 17.9 which is a modification negotiated by the parties and which is set out at Part III, subparagraph (s)(i) of the Agreement. This says:
"Lessee irrevocably appoints Corporation Service Company, 2–5 Benjamin Street, 1st Floor, London, EC1M 5QL United Kingdom … as its agent for service of process in relation to any proceedings in connection with this Lease Agreement and shall provide a letter confirming such appointment to the Lessor prior to the commencement date. If the appointment of the Lessee's agents hereunder cases to be effective, Lessee shall, as soon as reasonably practicable, appoint another person in England to accept process on its behalf in England and shall provide the Lessor with details of its new process agent, together with written confirmation from the new process agent that it has accepted its appointment."
I shall refer hereafter to Corporation Service Company as "CSC".
A letter appointing the process service agency was forthcoming. That letter says as follows. It is a letter on headed notepaper at the top left of the headed notepaper is the logo of Corporation Service Company and the words "Corporation Service Company". Its address is 2–5 Benjamin Street, 1st Floor, London EC1M 5QL United Kingdom. At the foot of the letter is the telephone number and the website CSCGlobal.co.uk. At the bottom left, in rather faint wording, is the name of Corporation Service Company (UK) Limited and its registered address and corporate number. At the bottom right is similar information for a company called CSS Digital Brand Services Limited. The text of the letter says as follows:
"September 18, 2015
Re: Confirmation of the appointment of Corporation Service Company (UK) Limited as agent for service of process in connection with the engine lease agreement (733359) dated 11 September 2015 between Aquila WSA Aviation Opportunities II Limited as Lessor and Onur Air Tasimacilik AS as Lessee (the "Agreement").
To whom it may concern
Corporation Service Company (UK) Limited accepts appointment as agent to receive service of process at 1st Floor, 205 Benjamin Street, London EC1M 5QL United Kingdom on behalf of Onur Air Tasimacilik AS pursuant to the agreement referenced above. This irrevocable appointment of agent is effective as of September 18, 2015 and will continue until September 18, 2016. When CSC receives legal process on behalf of Onur Air Tasimacilik AS, CSC will forward the documents by express courier, next day delivery to the forwarding address listed on the exhibit. The fee for this service is $608 per year. Because the term of the representation is one (1) years, the total cost is $608. All fees paid are not refundable.
It is the represented parties' responsibility to inform CSC of any changes to the forwarding address. If CSC attempts to forward legal process to a represented party and the legal process is returned to CSC as undeliverable, CSC will return the legal process to the serving party. CSC is not responsible for any liability arising out of the failure of the represented party to provide CSC with changes to its forwarding address, including attorney's fees and costs."
Then it is signed on behalf of Corporation Service Company (UK) Limited.
I shall refer to Corporation Services Company (UK) Limited as CSCUKL. CSCUKL was incorporated in 1996 under a different name and had, at the time of the contract, its registered office in Guildford, Surrey. Its registered office moved to Level 29, 40 Bank Street, E14 on 20 October 2016.
The background to the underlying dispute is that the defendant says it suffered ongoing problems with the engine almost immediately following delivery on 11 September 2015 and that these issues culminated in a surge event on 25 December 2015 on a commercial flight, which could have resulted in catastrophic loss of life had the aircraft not been able to make an emergency landing. The defendant's position is that the leased engine was fundamentally defective at the time of entry into the Lease and that they have now validly terminated the Lease on or before 6 April 2017 for repudiatory breach.
The claimant issued a claim form with attached Particulars of Claim on 16 December 2016 claiming something over US $9 million. The claim form seeks various sums allegedly due under the Lease and redelivery of the engine. No application was made or has been made for service out of the jurisdiction.
The dispute before me relates not to the underlying dispute but to the service or purported service of that claim form within the jurisdiction pursuant to the provisions of Clause 17.9 of the Lease. The position as to service is as follows.
a. The claim form and accompanying documents were sent "for information only" by email and courier to the defendant's address in Turkey. This is not relied upon as service. Turkey has specifically objected to Article 10 of the Hague Convention and the sending of documents was not pursuant to an order for service out of the jurisdiction.
b. The claimant attempted to serve Corporate Service Company by courier at 2–5 Benjamin Street, 1st Floor, London EC1M 5QL on 16 September 2016. The position as to this attempted service is a little unclear. The claimant says that the courier was unable to serve because the address was a building site and the documents were returned to it. The defendant's solicitor says she was informed by the defendant that they were attempted to be served by post and indeed made their way by some means to the defendant. Indeed, the covering letter is appended to Mr Clegg's first witness statement for the defendant. This is not, however, relied upon by the claimant as service. I should add here, that there is no evidence for the existence of any entity called Corporate Service Company at all, and there is no evidence that there is a corporate entity as named in the Lease called CSC.
The claimant says that they in fact served a company called Corporation Services Company Limited ("CSCL") at its new address 40 Bank Street, 29th Floor, London E14 5DS, which is also sometimes referred to as "Level 29, 40 Bank Street", and that they did so by giving the documents to a Mr Bdagi Ogunbase who seems, judging by the terms of the claimant's attendance note (there is a certificate of service but no process server's report) to have held himself out as authorised to accept service no behalf of the defendant.
Mr Bisson of White & Case states that the documents were delivered to Mr Bdagi Ogunbase at Corporation Service Company Limited, 40 Bank Street, 29th Floor, London E14 5DS. Mr Bdagi Ogunbase confirmed that Corporation Service Company was able to accept service on behalf of Onur Air Tasimacilik AS. Mr Bdagi Ogunbase signed for the documents at approximately 10.20 am on 19 December 2016 by way of signing and dating a copy of the covering letter. A copy of the covering letter, with what appears to be Mr Ogunbase's signature, is before me.
As to this, the evidence shows that CSCL was not in existence at the time of the contract on 11 September 2015. It was incorporated with its registered office at 1st Floor, 2–5 Benjamin Street, on 30 September 2015. It has since changed its registered office to Level 29, 40 Bank Street, London E14 5NR, and that is the same registered office as that which CSCUKL now has. It has a different company number to that of CSCUKL.
It is not clear what connection Mr Bdagi Ogunbase has to CSCL but there is no evidence that he has any connection to CSCUKL and there is no evidence as to the relationship between CSCL and CSCUKL.
It is not clear exactly what the position is as to by which of these means the proceedings actually came to the defendant's attention. The evidence says that copies sent to Turkey and Benjamin Street did come to the defendant's attention and we find this in the witness statement of Lindsey Clegg at page 28 of the bundle, where she says, "A letter addressed to the defendant dated 16 September 2016 enclosing the claim form and particulars of claim was sent by courier to Onur Air at Istanbul Ataturk Airport, however, the claim form was clearly marked "Not for service out of the jurisdiction", and a letter addressed to the defendant marked "c/o Corporate Service Company" and dated 16 December 2016...
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