W Nagel (A Firm) v Chaim Pluczenik

JurisdictionEngland & Wales
JudgeMrs Justice Cockerill
Judgment Date04 July 2022
Neutral Citation[2022] EWHC 1714 (Comm)
Docket NumberCase No: CL-2021-000336
CourtQueen's Bench Division (Commercial Court)
Year2022
Between:
W Nagel (A Firm)
Claimant
and
(1) Chaim Pluczenik
(2) Pluczenik Diamond Company NV
(3) Varda Shine
Defendants

[2022] EWHC 1714 (Comm)

Before:

Mrs Justice Cockerill DBE

Case No: CL-2021-000336

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS

OF ENGLAND AND WALES

QUEEN'S BENCH DIVISION

COMMERCIAL COURT

Rolls Building

Fetter Lane,

London,

EC4A 1NL

Jonathan Cohen QC (instructed by DWF Law LLP) for the Claimant

Ian Quirk QC (instructed by Mishcon de Reya LLP) for the First and Second Defendants

Ruth den Besten (instructed by Farrer & Co LLP) for the Third Defendant

Hearing dates: 20–21 June 2022

Approved Judgment

I direct that 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 judgment was handed down by the judge remotely by circulation to the parties' representatives by email and release to The National Archives. The date and time for hand-down is deemed to be Monday 4 July 2022 at 10:30am

Mrs Justice Cockerill
1

There are two applications before me:

i) An application by the First and Second Defendants that the Court (i) set aside an order made on 10 September 2021 by Moulder J for service out of the jurisdiction and (ii) grant declaratory relief pursuant to CPR Part 11.1 that this Court has no jurisdiction to try this claim, alternatively should not exercise any jurisdiction which it has;

ii) An application by the Third Defendant that the Court stay the proceedings on forum non conveniens grounds (the Third Defendant having been served in England without the need for permission).

2

I have decided to grant these applications. I will briefly set out the relevant background then take the applications in turn.

Relevant Background

3

The Second Defendant, Pluczenik Diamond Company (“PDC”), is a leading manufacturer and distributor of diamonds, many of which it purchases uncut from De Beers UK Limited (“De Beers”). PDC is a Belgian company. The First Defendant, Mr Pluczenik, is the Managing Director of PDC.

4

The Claimant, W Nagel (“Nagel”), is a broker in the diamond industry. Nagel, or members of the Nagel family, provided brokerage services to PDC from the 1960's until the termination of their relationship in August 2013.

5

It is fair to say that the termination of the relationship appears to have resulted in extremely hostile feelings on both sides of the dispute.

6

The Third Defendant, Ms Shine, was the CEO of a subsidiary of De Beers – De Beers Trading Company – from 2006 until January 2014. She has never worked for either of the Claimant or the First or Second Defendants.

7

After the termination of the Nagel-PDC relationship, two claims were brought in England and Belgium. They are central to the present proceedings.

8

In March Nagel issued a claim against PDC in the English High Court (the “English Claim”). The claim sought damages for breach of contract, alternatively under the Commercial Agency Regulations. The dispute centred on alleged failures to pay commission and/or give appropriate notice of termination. It did not immediately serve the claim, but sent a letter before action which indicated that it intended to bring proceedings in England.

9

In May 2015, PDC issued a claim in the Belgian Courts against Nagel and a related Belgian company, Simona NV (“Simona”). The claim was brought because of the threat of English proceedings and Mr Pluczenik would later accept in cross examination in the English Claim that Simona was named as a defendant to provide a base to found jurisdiction against Nagel.

10

A further claim was issued in Belgium on 22 September 2015 by PDC against Nagel, Willie Nagel (the founder of the Nagel brokerage business, since deceased) and Simona (Nagel's representative in Belgium). Those claims have been consolidated by the Belgian Court, and I refer to them together (the “Belgian Claim”). I refer to the various defendants in the Belgian Claim as the “Nagel parties”.

11

In the Belgian Claim, PDC alleges failures by the Nagel parties in performance of their brokerage duties causing PDC losses valued at €20 million. Specifically, PDC alleges that Nagel: (i) failed to submit a document about PDC's business to De Beers prior to the relevant deadline in March 2005 (“the Missed Deadline Allegation”); (ii) made negative remarks about PDC to De Beers in 2011 (“the Negative Comments Allegation”).

12

On 8 June 2015 (i.e. after issue of the original Belgian Claim), Nagel amended the English Claim to seek negative declaratory relief to the effect that it was not liable in respect of either of the Missed Deadline Allegation or the Negative Comments Allegation. That was itself a direct reaction to the Belgian Claim.

13

Late in 2015 Ms Shine indicated in a brief statement that she would be prepared to give a statement in the Belgian proceedings.

14

The English Claim was contested and on 13 July 2017, Popplewell J gave judgment in it: W Nagel (A Firm) v Pluczenik Diamond Company NV [2017] EWHC 1750 (Comm). Ms Shine was not called as a witness by either side; both sides sought her evidence, she indicated an unwillingness to be called and neither side chose to seek to compel her. Popplewell J found for Nagel, including in respect of the negative declaratory relief.

15

He plainly took a very dim view of the case advanced by PDC and its conduct, making the following findings:

i) As regards the Missed Deadline Allegation: “ The incident was exaggerated and mischaracterised in order to provide some basis for a claim in Belgium. There was no breach of contract or duty by WN”.

ii) As regards the Negative Comments Allegation: “ This allegation is equally unfounded”.

iii) As regards the Belgian Claim more generally: “ The Belgian proceedings were commenced for tactical reasons in an attempt by Pluczenik to found jurisdiction in Belgium and to dissuade WN from bringing its claim in these proceedings, which had been foreshadowed in a letter before action.”

16

Popplewell J's judgment (as regards this issues) was affirmed by the Court of Appeal: [2018] EWCA Civ 2640. That appeal did not concern the declaration of non-liability, permission to appeal having been refused on that point. The English claim has now ended, with all payments due having been made.

17

Meanwhile the Belgian Claim continued. In late 2017 Ms Shine gave a statement supporting PDC's case (“the Shine Statement”). She says this is because she had discovered the outcome of the English Proceedings dismissing the Alleged Defaults and it did not accord with her recollection.

18

Nagel originally objected to jurisdiction on the ground of lis pendens (Articles 29 and 30 of the Brussels Regulation). It also argued that the three key documents on which reliance was placed – including Ms Shine's statement — were forgeries. It did not raise issues of defendant jurisdiction; it says that it did not do so because under the approach of the Belgian Courts all that matters is what is said on the originating summons.

19

On 19 May 2020, the Belgian Court directed that a hearing be fixed to determine jurisdiction and the existence of the forgeries, and requested that the parties file additional submissions for that purpose.

20

The Belgian claimant submitted its arguments in July 2020. They contended for jurisdiction under Article 7 of the Brussels Regulation on the basis that services were provided in Belgium, via Simona's offices and the reason for the arrangement was to work together in Antwerp. That was supported by statements giving evidence that Mr Nagel used to attend offices in Antwerp and do business there. On that basis it was argued that the centre of gravity or characteristic performance was in Antwerp.

21

On 30 September 2020, the Nagel parties filed their submissions in response to the Belgian Court's directions. They did not make any substantive submissions on jurisdiction. There was no reference to and therefore no dispute of the points based on Article 7.

22

A hearing then took place in the Belgian Court on 5 January 2021, leading to an “Interim Judgment” on 2 February 2021. The hearing was attended by Nagel and their Belgian lawyers.

23

In that Interim Judgment, the Belgian Court found that:

i) “ it is necessary to first consider the question of international jurisdiction (and competence), and only after that can the forgery claim be considered”. I accept the submission of the First and Second Defendants that this means that it found that it had to determine jurisdiction before the forgery issues.

24

It stated that the assessment of jurisdiction had to be based on the phrasing of the summonses independent of the merits:

“In ruling on the international jurisdiction and competence of the court, one cannot anticipate the assessment of the merits, nor can one assess given documents. At best, there can be a prima facie assessment of given documents or a given merit of the matter (insofar as such is useful in judging the question of jurisdiction and competence), while a claim of forgery requires a specific investigation, as laid down by the Judicial Code.”

25

It considered the lis pendens issue noting that it could no longer apply now that the English Claim was concluded. It then concluded that it had jurisdiction to determine the dispute. The Court noted that the defendants apparently do not (or no longer) dispute that the services were performed in Antwerp.

26

The Court found that, as submitted by PDC, the services provided by the Nagel parties were performed in Belgium founding jurisdiction under Article 7.1 of the Brussels Regulation:

“PLUCZENIK demonstrates that the services were provided in Belgium, which is neither refuted nor disputed by the defendants. … The court thus finds that it has the required jurisdiction to take cognisance of the claims made by the parties”.

27

On the forgery issue the Court found...

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