The London Steam-Ship Owners' Mutual Insurance Association Ltd v The Kingdom of Spain
| Jurisdiction | England & Wales |
| Judge | Lord Justice Phillips,Lord Justice Popplewell,Lord Justice Males |
| Judgment Date | 01 March 2022 |
| Neutral Citation | [2022] EWCA Civ 238 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: CA-2021-000452 (formerly A4/2021/0337) |
[2022] EWCA Civ 238
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMMERICIAL COURT (QBD)
MR JUSTICE BUTCHER
[2020] EWHC 3540 (Comm)
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Males
Lord Justice Popplewell
and
Lord Justice Phillips
Case No: CA-2021-000452 (formerly A4/2021/0337)
Christopher Hancock QC, Charlotte Tan and Alexander Thompson (instructed by Ince Gordon Dadds LLP) for the Appellant
Timothy Young QC (instructed by Squire Patton Boggs (UK) LLP) for the Respondent
Hearing dates: 30 November and 1 December 2021
Approved Judgment
This judgment was handed down remotely at 2 pm on 1 March 2022 by circulation to the parties or their representatives by email and by release to BAILII and the National Archives.
Introduction
On 21 December 2020, shortly before the end of the implementation period of the United Kingdom's exit from the European Union (“IP completion day”) 1, Butcher J (“the Judge”) referred three questions as to the proper interpretation of Regulation (EU) No 44/2001 (“the Brussels I Regulation”) to the Court of Justice of the European Union (“the CJEU”). The reference was made pursuant to Article 267 of the Treaty on the Functioning of the European Union (“the TFEU”) which provides, so far as relevant, as follows:
“The [CJEU] shall have jurisdiction to give preliminary rulings concerning:
(a) the interpretation of the Treaties;
(b) the validity and interpretation of acts of the institutions, bodies, offices or agencies of the Union;
Where such a question is raised before any court or tribunal of a Member State, that court or tribunal may, if it considers that a decision on the question is necessary to enable it to give judgment, request the Court to give a ruling thereon…”
The Judge had announced his decision to make the referral on 18 December 2020, the day closing oral arguments had concluded at the end of a seven-day trial of an appeal brought by the appellant (“the Club”) against the registration of a judgment under the Brussels I Regulation, giving his reasons in a judgment delivered orally (“the Judgment”). The Judge did not, at that time, determine a further issue of English public policy in respect of which no reference was made and which, if decided in favour of the Club, would have determined the appeal in favour of the Club, regardless of the answers to the questions he referred to the CJEU.
The Club appeals that decision, with permission granted by Males LJ, on the ground that a ruling on the questions referred to the CJEU was not “necessary to enable [the Judge] to give judgment” within the meaning of Article 267. The Club contends that the referral was therefore outside the Judge's jurisdiction, wrong in principle and/or irrational when it was made. Although the Judge subsequently (on 12 May 2021) determined the further issue against the Club (so that a decision on the questions referred to the CJEU is, in the event, required), the power to make a referral to the CJEU would not then have been available, having ended on IP completion day 2. The Club
If the Club's challenge is well-founded, it is also necessary to consider the extent of the jurisdiction of this Court in respect of an appeal against the decision of a judge to refer questions to the CJEU. The parties were agreed that the appeal could be entertained, and a reasoned judgment delivered, but there was disagreement as to whether the Court has jurisdiction to allow the appeal and set aside the referral and/or to direct the Judge to withdraw it.
The background
The Spanish Proceedings and the Spanish Judgment
These proceedings concern the enforcement in England and Wales of an “execution order” issued by the Provincial Court of Coruña of the Kingdom of Spain on 1 March 2019, declaring that the Club (among others) was liable to numerous claimants, including the Respondent (“Spain”) for circa €2.355 billion but, in the case of the Club, subject to a global limit of €855,493,575.65, the Euro equivalent of US$1 billion less the fund deposited with the Spanish Courts in respect of the Club's compulsory insurance liability under the International Convention on Civil Liability for Oil Pollution 1992 (see footnote 3 below) (“the Spanish Judgment”).
The Spanish Judgment, reflecting decisions of the Spanish Supreme Court on both liability and quantum, related to the sinking of the MT Prestige (“the Vessel”) off Cape Finisterre on 19 November 2002 and the extensive pollution and massive damage caused along the Atlantic coastline of northern Spain and southern France by the escape of its cargo of 70,000 tonnes of fuel oil.
The Club was the Protection and Indemnity (P&I) insurer of the Vessel at the time the Vessel sank pursuant to a contract of insurance concluded by a Certificate of Entry dated 20 February 2002 (“the Contract”). The Contract was subject to a maximum aggregate amount of US$1 billion for any one occurrence and incorporated the Club's Rules of Class 5 – Protection and Indemnity (“the Club's Rules”). The Rules contained a “pay to be paid” clause, provided that the Contract was governed by English law and contained a London arbitration clause, any arbitration being subject to English law and the Arbitration Act 1996 (“the 1996 Act”).
The Spanish Judgment was obtained in respect of a direct civil claim against the Club under Article 117 of the Spanish Penal Code brought in June 2010 (“the Spanish Claim”) in on-going criminal proceedings against (among others) the Master, Chief Officer and Chief Engineer of the Vessel (“the Spanish Proceedings”). The Club has at all times contended that that Spanish Claim was brought in breach of the arbitration clause in the Contract requiring Spain to bring claims against the Club by way of London arbitration 3.
The arbitration and proceedings to enforce the award
In January 2012 the Club commenced arbitration proceedings against Spain. On 13 February 2013 the arbitrator, Alistair Schaff QC, made an award declaring that (1) Spain is bound by the arbitration clause contained in the Club's Rules and its claims must be referred to arbitration in London and (2) pursuant to the “pay to be paid” clause in the Club's Rules, the Club is not liable to Spain in respect of such claims in the absence of any prior payment.
Spain challenged the award pursuant to sections 67 and 72 of the 1996 Act on the ground that there was no arbitrable dispute and Mr Schaff had no jurisdiction, but that challenge was dismissed by Hamblen J on 22 October 2013. At the same time Hamblen J granted the Club permission to enforce the award pursuant to section 66(1) and entered judgment in terms of the award pursuant to section 66(2) of the 1996 Act, holding that Spain did not have state immunity because it was taken to have agreed in writing to arbitrate within section 9 of the State Immunity Act 1978: The Prestige (No. 2) [2013] EWHC 3188 (Comm), [2014] 1 Lloyd's Rep 309. The Court of Appeal dismissed Spain's appeal: [2015] EWCA Civ 333, [2015] 2 Lloyd's Rep 33, holding that Spain had also waived state immunity by making its applications under sections 67 and 72 of the 1996 Act. 4
Registration of Spanish Judgment
On 26 March 2019 Spain made an application for the registration of the Spanish Judgment as a judgment of the High Court pursuant to Article 33 of the Brussels I Regulation. Following standard practice, the application was made without notice to the Club. On 28 May 2019 Master Cook made a registration order on the papers.
These proceedings: the Club's appeal against the registration order
On 26 June 2019 the Club appealed the registration order pursuant to Article 43 of the Brussels I Regulation and the former CPR 74.8(2). The Club contended that the Spanish Judgment should not be recognised:
i) under Article 34(3) of the Brussels I Regulation, because the Spanish judgment was irreconcilable with the prior judgment entered by Hamblen J dated 22 October 2013, enforcing an arbitration award which declared that the Club was not liable to Spain;
ii) under Article 34(1) of the Brussels I Regulation, because recognition was manifestly contrary to English public policy in respect of (a) the rule of res judicata (applicable by virtue of the arbitration award and/or the judgment entered by Hamblen J); or (b) human and fundamental rights, the Club contending that the proceedings in Spain breached the rights of the Master to a fair trial, and therefore those of the Club.
The appeal was fixed for a two-week trial from 2 December 2020 to determine (i) as a matter of law, whether the judgment entered by Hamblen J constituted a judgment within the meaning of Article 34(3) and, if not, whether that judgment and the
arbitration award (and the res judicata to which they give rise as a matter of English law) could be relied upon and (ii) as a matter of fact and law, whether the Spanish Proceedings had breached the human rights of the defendants, including the Club. There was no application, or order, for any of the issues raised by the Club's appeal to be determined as a preliminary issue. The trial was intended to determine all the issues in a single hearing. In respect of the human rights issues the parties exchanged witness statements and expert reportsOn 3 November 2020 Spain made an application seeking the reference of six questions to the CJEU (later adding a seventh). Spain invited Butcher J to determine that application at the hearing of the appeal in...
To continue reading
Request your trial
-
DCP Successors Ltd v The Trade Administrator, The Trade Board Ltd, Commissioner of Customs and Excise, Jamaica Customs Agency, Blue Power Group Ltd
...but the trial Court. 52 Ms. Mayhew relied on the decision in Bulmer above as well as the decision in London Steamship Owners Mutual Insurance Association Limited v The Kingdom of Spain 7 in support of her 53 In light of where we are in the proceedings and the nature of the application befor......