Tilia Sonera AB v Hilcourt (Docklands) Ltd
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE PARK,MR JUSTICE ETHERTON |
| Judgment Date | 04 July 2003 |
| Neutral Citation | [2003] EWHC 3540 (Ch),[2002] EWHC 2377 (Ch) |
| Docket Number | No: 6394 of 2002 |
| Court | Chancery Division |
| Date | 04 July 2003 |
[2002] EWHC 2377 (Ch)
IN THE HIGH COURT OF JUSTICE
Royal Courts of Justice
The Strand
London WC2A 2LL
Mr Justice Park
No: 6394 of 2002
CHANCERY DIVISION
MR E McQUATER appeared on behalf of the Applicant
MR S BERRY QC appeared on behalf of the Respondent
Wednesday, 16 th October 2002
The application advanced by Mr McQuater on behalf of Telia is for an injunction to restrain Hillcourt(?) from presenting a winding-up petition. I am going to grant that injunction. In my judgment Hillcourt had made amply sufficient threats of winding-up proceedings in this country to justify the commencement of proceedings claiming an injunction.
Very recently—as I understand it some time last Friday—it was indicated on behalf of Hillcourt that it was proposing to pursue insolvency proceedings in Sweden. Nevertheless, Hillcourt is not willing to give an undertaking not to pursue winding-up proceedings in this country. It has served a statutory demand, which it has not withdrawn, if indeed it would be possible to withdraw it. In the absence of an undertaking I believe that Telia is justified in pressing upon me its application for an injunction. On the merits of the matter it seems to me clear that insolvency proceedings could not be fought in this country against Telia under the European Union Regulation of 29 th May 2000, which is now in force. It is to my mind clear beyond any serious argument that winding-up proceedings directed at Telia can only be brought in Sweden and that the courts of England and Wales have no jurisdiction.
I ought specifically to say that I do not think that there is any force in the submission that business premises of Telia's United Kingdom subsidiary company can rank as an "establishment" of Telia for the purposes of Article 3.2 of the Regulation. I refer also in this connection to the definition of "establishment" in Article 2.8. There are other points which could be made even on the domestic law of this country to the effect that the threat in England of winding-up proceedings was not a proper remedy for Hillcourt to pursue its case that Telia had owed rent to it and had no justification for withholding payment of it. However, what I have said, I believe, is sufficient in itself. In those circumstances I will grant the injunction which is requested.
The other matter is that I am invited on behalf of Hillcourt to make an order, the practical effect of which would be the giving of final judgment against Telia in respect of the rent, which it has not paid Telia under the lease. I do not believe that I can make that order, but I do wish to make it clear that the reason why not, in my mind, is entirely a procedural one and has nothing to do with the underlying substantive merits. I should state the following point provisionally only because it is possible that the matter may come back before a court hereafter. However, I can see no substance whatever in any of the grounds on which it has been tentatively suggested that Telia may have been entitled to withhold the payment of rent which it has not made. However, whether I am right on that or not I cannot accept that Hillcourt can somehow use the framework of Telia's properly constituted claim against it for an injunction restraining it from serving a winding-up petition in order to secure final judgment for its unpaid rent. Mr McQuater put it to me in terms that it can hardly be right that the interim applications court can be used by a person who attends as a respondent to another party's application, but upon doing so obtains final judgment in its own favour on short notice in respect of a claim which has not even been started.
Mr Berry is right that the points made in this connection are essentially procedural points; indeed, they are wholly procedural points. They do not go to the merits of the matter. Even so, the degree of violence which would be done to the procedural structure laid down under the Civil Procedure Rules would, in my judgment, be too great to justify me in making the order in favour of Hillcourt which I am asked to make. Hillcourt can certainly commence proceedings in proper form, and as it presently seems to me it would be likely to obtain the judgment which it seeks in those proceedings. However, I feel that it is not possible for me to give to it the judgment which it seeks in the present application before me today. That, I think, is all that I am going to say.
(Discussion as to costs)
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[2003] EWHC 3540 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Strand
London WC2A 2LL
Mr Justice Etherton
MR PAUL MORGAN QC appeared on behalf of the Appellant
MR SIMON BERRY QC appeared on behalf of the Respondent
(Approved by the Court)
This is an appeal by Telia Sonera AB ("Telia") from the second interim award of John Martin QC ("the Arbitrator") in arbitration proceedings between Telia and Hilcourt (Docklands) Limited ("Hilcourt") under the Arbitration Act 1996 ("the 1996 Act").
By a lease agreement dated 25 th August 2000 made between Hilcourt and Telia ("the Lease Agreement"), Hilcourt agreed to grant Telia a lease of land and buildings at 443–451 Westferry Road, London E14 ("the Property") for a term of 35 years. The terms of the Lease Agreement included an obligation on the part of Telia to carry out works for the refurbishment and refitting of the Property. Those works were defined in the Lease Agreement (and are referred to in this judgment) as "the Refurbishment Works".
In clause 4.1 of the Lease Agreement Telia agreed, so far as material, as follows:
"Within ten (10) working days after the Lease Completion Date [Telia] shall procure the commencement of the construction of the Refurbishment Works and shall use all reasonable endeavours to procure that the Practical Completion Date occurs within the Construction Period…"
The "Refurbishment Works" were described by reference to a specification annexed to the Lease Agreement. Although described as "Refurbishment Works" the relevant works involved the substantial demolition of a building and effectively the construction of a new building.
"The Lease Completion Date" was defined in the Lease Agreement as being 15 th September 2000.
"The Construction Period" was defined in the Lease Agreement as being "12 months from and including the date of commencement of the Refurbishment Works as extended by Extensions of Time".
On 15 th September 2000 Hilcourt granted a lease of the Property to Telia pursuant to the Lease Agreement ("the Lease").
It appears that Telia commenced the Refurbishment Works in about September 2001 but has not completed those works. It is alleged by Hilcourt that Telia has done no more than undertake the removal of asbestos and stripping out work. Hilcourt claims that Telia has accordingly failed to carry out the Refurbishment Works timeously or at all, and it claims a mandatory injunction requiring Telia to carry out and complete the Refurbishment Works.
The Lease Agreement contained an arbitration clause providing for any disputes or differences between Hilcourt and Telia as to their respective rights, duties or obligations, or as to any other matter or thing in any way arising out of or in connection with the subject matter of the Lease Agreement, to be referred, in accordance with the provisions of the 1996 Act, to the determination of a single arbitrator, to be agreed upon by the parties or, failing agreement, nominated by the President of the Royal Institution of Chartered Surveyors.
The dispute between the parties was in due course referred to the Arbitrator pursuant to that arbitration provision.
An issue arose before the Arbitrator as to whether he had power to order specific performance of Telia's obligation to carry out the Refurbishment Works in view of the limitation of his powers contained in section 48(5)(b) of the 1996 Act. Section 48 provides, so far as relevant, as follows:
"48(1) The parties are free to agree on the powers exercisable by the arbitral tribunal as regards remedies.
(2) Unless otherwise agreed by the parties, the tribunal has the following powers.
(5) The tribunal has the same powers as the court—
(a) to order a party to do or refrain from doing anything
(b) to order specific performance of a contract (other than a contract relating to land)."
The Arbitrator ordered that there be tried as a preliminary issue the question whether, in the light of the limitation of his powers contained in section 48(5)(b) of the 1996 Act, he had the power to grant the relief sought by Hilcourt, which, as I have said, is expressed in the Points of Claim in the arbitration as a mandatory injunction requiring Telia to carry out and complete the Refurbishment Works.
The Arbitrator's determination of that preliminary issue was contained in his second interim award dated 31 st March 2003 ("the Award") and his written reasons which accompanied it ("the Reasons").
In paragraph 12 of the skeleton argument for Telia on this appeal the findings of the Arbitrator in the Award and his Reasons, so far as relevant, are summarised as follows. First, Hilcourt's claim is properly to be characterised as specific performance of clause 4.1 of the Lease Agreement. Second, the Lease Agreement as a whole is a contract 'relating to land' within section 48(5)(b) of the 1996 Act. Third, the...
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Mr David Sterling v Mrs Miriam Rand
...to an agreement in writing as set out in s.5 of the 1996 Act). 48 The effect of s.48(5)(b) is dealt with in detail by Etherton J in Telia Sonera AB v Hilcourt [2003] EWHC 3540 (Ch). He notes that there has been a long-held statutory preference for such orders not to be made by arbitrators,......