Royal & Sun Alliance Insurance Plc and another v MLK Digital FZE (Cyprus) Ltd and Others
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE AIKENS,Mr Justice Aikens |
| Judgment Date | 21 June 2005 |
| Neutral Citation | [2005] EWHC 1408 (Comm) |
| Docket Number | Case No: 2004/962 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 21 June 2005 |
[2005] EWHC 1408 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Mr Justice Aikens
Case No: 2004/962
Mr Stephen Kenny (instructed by Hill Dickinson, Solicitors, London) for the Claimants
Mr Charles Graham QC (instructed by Hassan Khan & Co, Solicitors, London) for the Second Defendants
Hearing dates: 10 th June 2005
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.
This is an application by Hi—Tec Electronics SA ("Hi—Tec") under CPR Pt 11.1 for one of two orders. The first order sought is for a declaration that the Court has no jurisdiction to try the claimants' claim against the second defendants and so service of the claim form on the second defendants be set aside. The second, and alternative, is for a declaration that the Court should not exercise any jurisdiction which it may have to try that claim and an order staying those proceedings.
These proceedings and proceedings which are currently going on in the Tribunal de Commerce de Villefranche—Tarare, arise out of the theft of a consignment of 90 pallets of mobile telephones when they were being transported in a 40 tonne rigid trailer on the autoroute from Paris to Calais on 4 November 2004. The value of the mobile phones is about £3.5 million.
Interesting issues arise on this application. The hearing before me took a day on Friday 10 June 2005. I would have preferred to take more time to set out my reasons for my decision, which could have been handed down in the normal way. However I was told by both parties that it would be most helpful for my decision and reasons to be available before a judgment is given by the judge in the French Court, which is due on Thursday 23 June. So I have prepared this draft judgment and have stated that it can be shown in this unofficial form to the French Court. Unfortunately the intervention of other business has prevented me from providing the draft before today.
The second claimant is a French company. The first claimant ("Royal & Sun") is Exel's goods in transit legal liability insurer. The reason for joining it to the present proceedings is, I am told, because under French law it is possible to sue directly a liability insurer and it was thought by those advising the claimants that this might happen to Royal & Sun in French proceedings.
The first defendant (MK Digital FZE (Cyprus) Ltd: "MK Digital") is a Cyprus company which sells mobile telephones. That company is owned and controlled by Mr Moizuddin Khan who has an address in Dubai. MK Digital sold the mobile telephones (which were subsequently stolen) to Hi—Tec. That is a company incorporated in Denmark. There is a dispute (which in my view does not matter for present purposes) about whether Hi—Tec actually carries on business in England and Wales. Hi—Tec trades in wholesale markets for electronics components, including mobile telephones.
The third defendant, TRS Univers Lines ("TRS") is a company that is incorporated in France. It is a road carrier. The fourth defendant, AMS, is also a French company and is also a road carrier.
The background to the case is this: on about 28 October 2004, Hi—Tec placed an order for a total of 18,000 Nokia mobile telephones with MK Digital. One part of the order consisted of 8,000 Nokia 7610 GSM handsets SIM Free; the other consisted of 10,000 Nokia 7200 GSM handsets SIM Free. The whole consignment was to be delivered FOB Larnaca airport, Cyprus on 4 November 2004.
The goods were to be flown to France. MK Digital arranged for a Cyprus company to fly the goods to France.
There is a dispute as to the ultimate destination of the mobile telephones once they reached France. It is the case of Hi—Tec that the mobile phones were destined for a customer in Italy called Nuovo Suono, pursuant to a contract of purchase made on about 28 October 2004 between Hi—Tec as sellers and Nuovo Suono as buyers. But it is the case of Exel that these mobile phones were destined for the UK. The issue of the designated delivery place of the mobile phones is important and I will have to form a view (on the evidence I have now) about that.
In any case, Hi—Tec had contacted Exel to arrange for the onward carriage of the mobile telephones upon arrival at Paris. There is no dispute that instructions were given by Hi—Tec to Exel in relation to the carriage of the goods from Paris. The other key dispute between Exel and Hi—Tec arises on the nature of the contract concluded between Exel and Hi—Tec. Exel says that the contract made with Hi—Tec on 3 November 2004 was for the carriage of the mobile telephones from Paris to Middlesex. Hi—Tec says that Exel was engaged as a freight forwarder, or in French legal terminology, as a "commissionaire de transport". There is, in French law, a most important distinction in terms of potential liability to goods owners as between that of a "commissionaire de transport" and an international carrier by road. I will have to expand on that in due course.
At all events, Exel understood that the consignment of mobile phones was to be collected from a cargo depot at Charles De Gaulle airport and was to be transported to the premises of Interken Freighters (UK) Ltd in Southall, Middlesex.
Exel contacted TRS, which regularly provided road transport to carry goods for Exel. TRS told Exel that it could not provide a 40 tonne rigid trailer, but it could use a sub-contractor, AMS, to supply this equipment to Southall. That was agreed. Exel prepared the CMR Note for the movement. It was also agreed that Exel would provide an escort driver. He was M. Jean Claude Chauvet, who was employed by Exel regularly as a driver of its vehicles.
M. Chauvet went to Charles De Gaulle airport and, after some delay, the truck arrived at Freight Area 5 at 3pm on 4 November 2004. The details in the CMR Note were completed and the truck, trailer and escort vehicle set off onto the autoroute A1 to Calais. After a little while the truck turned off at an "Aire" at Ressons. M. Chauvet also turned off. The two truck drivers and M Chauvet went to have a cup of coffee. On returning to the transports, the truck moved off but M Chauvet could not because the tyres of his vehicle had been slashed. M Chauvet telephoned the truck drivers to tell them to wait. They said that there were on the autoroute and so he would just have to catch up. M Chauvet was suspicious and so rang the police. But in fact the truck disappeared and the consignment has never been seen since.
The proceedings in England and France:
The two claimants issued their claim form in "The Admiralty and Commercial Court" on 11 November 2004. The Brief Details of Claim state: (i) a contract between Hi—Tec and Exel was concluded on 4 November 2004 whereby Exel would carry a consignment of 90 pallets of mobile telephones from France to the UK. This contract was subject to the Convention on the Carriage of Goods by Road ("CMR") given the force of law in the UK by the Carriage by Road Act 1965; (ii) this contract was sub—contracted to TRS; (iii) the consignment was stolen whilst in the care and custody of TRS. There are three types of relief claimed by both claimants. The first is: "A declaration against the first and/or second Defendants or any other parties interested in the consignment that they have no liability for the loss sustained in respect of the theft (none being admitted) or in the alternative that any such liability is limited by virtue of Article 23 CMR". The second is for: "…damages as against the third Defendants for breach of contract and/or breach of duty and/or negligence in or about the care, custody, carriage and delivery of the consignment." The third is for: "an indemnity and/or contribution from the third Defendant in respect of any damages, interest and/or costs which they have to pay to the first and/or second Defendant or any other person interested in the consignment". The English action is therefore one claiming declarations that the disputes between the parties are governed by the CMR; for declarations of non—liability or limited liability on the part of Exel; and a claim for an indemnity or contribution from other defendants for any liability of Exel towards Hi—Tec or anyone else interested in the consignment.
The statement at the foot of the Brief Particulars are important: that reads: "We certify that the High Court of England and Wales has the power to hear and determined the Claimants' claims against the Defendants by virtue of Article 57 of the Civil Jurisdiction Judgments Act 1991 and the Convention on the International Carriage of Goods by Road (CMR) enacted in the Carriage of Goods by Road Act 1965 and that no proceedings involving the same cause of action are pending between the parties in Scotland, Northern Ireland, or any other Convention territory of any contracting state, as defined, by Section 1(3) of the Civil Jurisdiction Judgments Act 1982 as amended by section 2(5) of the Civil Jurisdiction and Judgments Act 1991".
It is clear that the claimants were saying that jurisdiction could be founded under the terms of Art 31 (1) of the CMR and that, as is provided for in Art 31 (2) of the CMR, there were no other proceedings pending in a court that would be competent to hear the claim under the terms of Art 31. I will have to return to this later on.
At the time the English proceedings were issued, there were no other proceedings. On 26 November 2004 AMS were added to the Claim form.
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