Katsouris Brothers Ltd v Haitoglou Bros S.A. (Defendant/Applicant)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Eder |
| Judgment Date | 31 January 2011 |
| Neutral Citation | [2011] EWHC 111 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ08X04736 |
| Date | 31 January 2011 |
[2011] EWHC 111 (QB)
The Honourable Mr Justice Eder
The Honourable Mr Justice Eder
Case No: HQ08X04736
Claim No 20091547
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Alexander Layton QC (instructed by Berrymans Lace Mawer) for Katsouris Brothers Limited
Mr Tim Lord QC and Mr Richard Eschwege (instructed by Watmores Solicitors) for Haitoglou Bros S.A.
Hearing dates: 13–14 TH JANUARY 2011
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Mr Justice Eder:
Introduction
This case concerns the supply in 2006 of tahini, alleged to be contaminated with salmonella, by Haitoglou Brothers SA ("HB") in Greece to Katsouris Brothers Limited ("KBL") in England, who then supplied it on unaltered to Katsouris Fresh Foods Limited and/or Bakkavor Foods Limited (together "KFF"). KFF used the tahini in the manufacture of houmous which was then onsold to various retailers including Marks & Spencer, J Sainsbury and Waitrose. It is alleged by KBL that discovery of the contamination of the houmous led to a product re-call.
Disputes have arisen between KFF, KBL and HB in relation to these matters. As referred to below, the claim by KFF against KBL is now the subject-matter of proceedings in the Commercial Court in England. KBL accepts that any claim it may have against HB in contract must be brought in the courts of Greece. The focus of the present dispute is whether KBL's claims against HB in tort and/or by way of contribution under the Civil Liability Contribution Act 1978 (the "1978 Act") should be determined in England or in Greece. In essence, KBL says England; HB says Greece. That is the essential issue which I have to determine.
There are four sets of relevant proceedings (in chronological order):
(1) KBL v HB, commenced in the Queen's Bench Division of the High Court by a Claim Form on 28 th November 2008 and served on 30 th April 2009 (the "Queen's Bench action");
(2) KFF v KBL, commenced in the Commercial Court by a Claim Form issued on 27 th November 2009 (the "KFF action");
(3) HB v KBL, a negative declaratory relief action commenced in Greece on 30 th December 2009 and served in England on 13 th January 2010 (the "Greek Proceedings"); and
(4) KBL v HB, Part 20 Proceedings commenced on 24 th September 2010 in the KFF action by leave of Mr Justice Flaux given on 6 th September 2010 (the "Part 20 Claim").
There are 4 applications before the Court:
(1) KBL's application for an extension of time for service of its Particulars of Claim in the Queen's Bench action;
(2) HB's application disputing the Court's jurisdiction in the Queen's Bench action;
(3) HB's application disputing the Court's jurisdiction in relation to the Part 20 Claim in the KFF action; and
(4) KBL's application to transfer the Queen's Bench action to the Commercial Court and for consequential directions.
I heard oral argument from Counsel on behalf of KBL and HB in relation to these applications on 13 th -14 th January 2011. KFF did not appear although I was told that representatives of KFF were present in Court during the hearing. In light of imminent hearings in both Greece and England (as referred to below) and at the request of KBL (which request was not objected to by HB), I informed the parties at the end of that hearing on 14 th January of my decision in relation to these applications. Thereafter, an Order was drawn up. This Judgment sets out the reasons for that decision and Order.
Background Facts
For present purposes, the relevant background facts can be summarised as follows.
HB is a Greek company based in Thessaloniki: it makes and supplies foodstuffs, including tahini paste. Tahini paste is an ingredient in houmous and is produced from the roasting and grinding of sesame seeds.
Pursuant to an "ex – works" contract, HB supplied KBL with certain batches of tahini paste on 30 th November 2006, 12 th December 2006 and 14 th December 2006 and delivered them to KBL in Thessaloniki. KBL arranged for the tahini paste to be shipped to England and sold the tahini paste to KFF. KFF used the tahini paste to make houmous for sale in the United Kingdom.
KBL alleges that the batches of tahini paste were contaminated with salmonella and that the source of the salmonella was the heat exchanger pipework in HB's premises in Greece. HB disputes all KBL's allegations.
On 28 th November 2008, KBL issued the Claim Form in the Queen's Bench action against HB. It stated as follows:
"[KBL] brings a claim against [HB] for breach of contract, for negligence and breach of statute due to the supply of food products by [HB] to [KBL] from 30 th November 2006 onwards that were contaminated with salmonella. As a result [KBL] claims from [HB] damages and/or indemnity and/or a contribution in respect of any sum, damages or costs that it is required to pay to its customers, and in particular Bakkavor Foods Limited/Katsouris Fresh Foods, in respect of the supply of the contaminated food products, together with any further losses sustained by [KBL] to be quantified. "
On 24 th April 2009, with the Claim Form still not served, KBL invited HB to agree to an extension of time for service of the Particulars of Claim. No such agreement was forthcoming from HB.
On 30 th April 2009, KBL finally served the Claim Form on HB in Greece. The Claim Form said that Particulars of Claim were to follow. Similarly, KBL's solicitors, Berrymans, said that they would follow in "due course".
That same day KBL made an ex parte application before Master Roberts to extend the time for service of the Particulars of Claim. An order was granted for service of the Particulars of the Claim to be effected:
"28 days after the proposed meeting between the parties, which is due to take place shortly."
However, no date for any such meeting had been fixed at that time. Without service of the Particulars of Claim, HB was under no obligation under the CPR to make an acknowledgement of service or otherwise contest the jurisdiction of the English Court. Under the CPR, it would have been open to HB to dispute jurisdiction at this stage but, as I have stated, HB was under no obligation to do so.
Meanwhile, on 3 rd July 2009, KFF sent a letter before action to KBL. No letter was sent by KFF to HB.
On 7 th September 2009 KBL and HB did meet but did not reach any settlement.
After the 7 th September 2009 meeting, contrary to the order of Master Roberts, KBL did not serve the Particulars of Claim. On the contrary, on 22 nd October 2009, Berrymans wrote to HB's solicitors, Watmores, as follows:
"As we explained, we have not served those proceedings and have allowed them to lapse because following further advice from our client's counsel, we are satisfied that English law will apply to the contract between [KBL] and [HB].
…we have, course, maintained throughout this matter that English law will apply to the dispute between our clients.
We also consider that there can be no dispute that English law will apply to the tortious claim that our client would bring against your client given that the harmful event/ damage occurred in England
…Given that KFF shortly intend to issue proceedings against our client in England, we will seek to join your client at those proceedings in England and English law will apply".
On 27 th November 2009, KFF issued proceedings against KBL in the Commercial Court in London in the KFF Action. HB was not informed by KBL that the KFF Action had been issued against it, KBL. Nor, contrary to what it had said in its letter of 22 nd October 2009, did KBL thereupon take any steps to join HB as a Part 20 Defendant.
On 2 nd December 2009, the Claim Form in the KFF Action was served by KFF on KBL.
On 30 th December 2009, HB, unaware of the KFF Action, commenced the Greek Proceedings against KBL in the Court of First Instance in Thessaloniki. An English translation of the formal document commencing those Greek Proceedings has been exhibited to the first witness statement of Mr Turner. I shall refer to it as the "Greek Claim Form". This is an important document which bears close reading. Its salient features may be summarised as follows: —
(1) The heading states that it is a "negative declaratory action" and refers to Article 70 of the Code of Civil Procedure.
(2) There then follows an introductory section followed by what is headed a "History of Dispute". Included within that section is paragraph 2.8 which refers to a letter from Berrymans to HB dated 28.11.2008 stating that HB was going to face an action by KFF for the restoration of the damages suffered by KFF as a consequence of the withdrawal of quantities of the houmous produced by it from the market in February 2007 and that KBL renders HB responsible for any compensation that it may be compelled to pay to KFF from "the aforementioned cause".
(3) After referring to further events and correspondence, paragraph 2.16 refers to and sets out at some length the contents of the Claim Form issued by KBL against HB in the Queen's Bench action quoting the relief sought in that action including "damages and/or indemnity and/or contribution in respect of any sums, damages or costs that it [KBL] is required to pay to its customers and in particular to Katsouris Fresh Foods/...
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