Mr George Gabriel Bitar v Banque Libano-Française S.A.L.
| Jurisdiction | England & Wales |
| Judge | Michael Kent,Michael Kent QC |
| Judgment Date | 20 October 2021 |
| Neutral Citation | [2021] EWHC 2787 (QB) |
| Docket Number | Case No: QB-2021-000430 |
| Court | Queen's Bench Division |
[2021] EWHC 2787 (QB)
Michael Kent QC
(Sitting as a Deputy High Court Judge)
Case No: QB-2021-000430
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
James Cutress QC and Daniel Carall-Green (instructed by RBG Legal Services Ltd) for the Claimant
Rajesh Pillai QC (instructed by Dechert LLP) for the Defendant
Hearing dates: 21 September 2021
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.
Michael Kent QC
Banque Libano-Francaise S.A.L., a Lebanese bank whose headquarters are in Beirut (which I will refer to as the Bank), applies under CPR Part 11 for a declaration that the Courts of England and Wales have no jurisdiction to hear this claim and for consequential orders. These proceedings were commenced by a Claim Form issued on 5 February 2021 and, pursuant to the order of Master Cook on a without notice application giving them permission to do so, the Claim Form and attached Particulars of Claim were served out of the jurisdiction on the Defendant in Beirut, Lebanon by courier and by email. The Bank applied to the Master to set aside the order permitting such service. This the Master refused but he extended time for service of any application to challenge jurisdiction. In accordance with that the Bank issued this application notice which came on for hearing before me on 21 September 2021.
The Claimant by his Particulars of Claim seeks payment of the sum of US$4,245,829 said to be the balance standing to his credit under a joint account with the Bank, together with damages for breach of contract in failing to repay this sum on demand, interest and costs. Although not strictly relevant to the issues I have to decide it is explained that the reason he wishes to bring proceedings in this jurisdiction is that the Defendant seeks to repay the Claimant by a special form of banker's cheque issued by the Lebanese Central Bank in view of the banking crisis in the country which started at the end of 2019. This would result in the money becoming effectively trapped in the Lebanese banking system because such cheques are unable to be deposited into an account outside Lebanon. Dollar payments in this form are known colloquially as “ Lollars”, said to be worth only around 40% of a US dollar.
The relevant account was opened with the Bank on 17 October 2014 as a joint account together with the Claimant's parents and his brother and at the same time a retail banking services agreement was entered into which included a “multi-package” account agreement. The joint account could be operated under the individual signature of any one of the account holders. These documents were written in French though an original text in Arabic was said to take priority (there was some limited wording in English including conforming to the requirements of the US Foreign Account Tax Compliance Act). It is not in dispute that the relevant banking agreement is stated to be governed by Lebanese law and it contains a jurisdiction clause stating, in translation, that “ [a]ny dispute concerning the application or interpretation of these General Conditions falls within the jurisdiction of the courts of Beirut”.
There is an issue as to whether this constitutes an exclusive jurisdiction clause but that is not something I have to resolve because the question before me is simply whether, notwithstanding the terms of the agreement in relation to jurisdiction, the Claimant is entitled to bring proceedings against the Bank in this jurisdiction by virtue of section 15B(2)(b) of the Civil Jurisdiction and Judgments Act 1982. Sections 15A to 15E inclusive of that Act were inserted, with effect from 31 December 2020 (known as IP completion day), by the Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019). They override any exclusive jurisdiction clause in a contract.
These sections essentially reproduce as part of the UK statute what had previously been contained in Articles 17–19 of Regulation (EU) 1215/2012 of the European Parliament and of the Council (known as the Brussels 1 Regulation recast) which had been retained in UK law in the transition period between the end of January and the end of December 2020.
The provisions of the amended 1982 Act relevant to this application are as follows:
15B.—Jurisdiction in relation to consumer contracts
(1) This section applies in relation to proceedings whose subject-matter is a matter relating to a consumer contract where the consumer is domiciled in the United Kingdom.
(2) The consumer may bring proceedings against the other party to the consumer contract—
…
(b) in the courts for the place where the consumer is domiciled (regardless of the domicile of the other party to the consumer contract).
…
(6) Subsections (2) and (3) may be departed from only by an agreement—
(a) which is entered into after the dispute has arisen,
(b) which allows the consumer to bring proceedings in courts other than those indicated in this section, or
(c) which is entered into by the consumer and the other party to the contract, both of whom are at the time of conclusion of the contract domiciled or habitually resident in the United Kingdom and in the same part of the United Kingdom, and which confers jurisdiction on the courts of that part of the United Kingdom, provided that such an agreement is not contrary to the law of that part of the United Kingdom.
15D.—Further provision as to jurisdiction
(1) Agreements or provisions of a trust instrument conferring jurisdiction shall have no legal force if they are contrary to the provisions of section 15B ( 6) or 15C (6).
15E.—Interpretation
(1) In sections 15A to 15D and this section—
“consumer”, in relation to a consumer contract, means a person who concludes the contract for a purpose which can be regarded as being outside the person's trade or profession;
“consumer contract” means—
(a) a contract for the sale of goods on instalment credit terms,
(b) a contract for a loan repayable by instalments, or for any other form of credit, made to finance the sale of goods, or
(c) a contract which has been concluded with a person who—
(i) pursues commercial or professional activities in the part of the United Kingdom in which the consumer is domiciled, or
(ii) by any means, directs such activities to that part or to other parts of the United Kingdom including that part,
and which falls within the scope of such activities,
but it does not include a contract of transport other than a contract which, for an inclusive price, provides for a combination of travel and accommodation or a contract of insurance,
…
(2) In determining any question as to the meaning or effect of any provision contained in sections 15A to 15D and this section—
(a) regard is to be had to any relevant principles laid down before IP completion day by the European Court in connection with Title II of the 1968 Convention or Chapter 2 of the Regulation and to any relevant decision of that court before IP completion day as to the meaning or effect of any provision of that Title or Chapter, and
(b) without prejudice to the generality of paragraph (a), the expert reports relating to the 1968 Convention may be considered and are, so far as relevant, to be given such weight as is appropriate in the circumstances.
Subject therefore to the possibility of departing from EU case law, it is necessary to look at the authorities concerned with the interpretation and application of Articles 17–19 of the Brussels 1 Regulation recast. There is no dispute before me as to the Claimant's domicile. He is a British national holding joint Syrian nationality who was born in Britain and who has always lived in England. He is currently a medical doctor working in the NHS. His mother is resident in Lebanon. His parents now have Lebanese nationality though they had Syrian origins.
Nor is there any dispute that the banking agreement, which is the subject of this claim qualifies as a consumer contract as defined. I have been invited to bear in mind the relatively sophisticated nature of this contract and the Claimant's role in it, together with those of his father and brother, but once it is conceded that this is a consumer contract those aspects of the case cannot have any bearing on the outcome. Though clearly this was legislation designed to protect consumers who may be the more vulnerable party in a transaction (“ to ensure adequate protection for the consumer, as the party deemed to be economically weaker and less experienced in legal matters than the other, commercial, party to the contract”: Pammer (infra) at [58]), there is nothing in the legislation which makes any distinction based upon the relative sophistication of the consumer in question. Indeed, in relation to the matter I am required to consider the state of mind and understanding of this particular consumer is not relevant at all though his actions may provide some indirect evidence bearing on the issues I do have to consider. Equally it is irrelevant that the benefit of any judgment in these proceedings against the Bank will also accrue to joint account holders (the Claimant's parents and brother) who are not domiciled in this jurisdiction, as is the suggestion that the source of the monies is really the father's own business profits.
It is agreed that I am deciding a question of fact. The Claimant's case is based upon the second limb of the definition of “consumer...
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