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Service of Process in England on Overseas Companies and Article 5(5) of the Brussels Convention

Published online by Cambridge University Press:  17 January 2008

Nelson E. Enonchong
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Extract

It is generally accepted that, in actions in personam, the foundation of the court's jurisdiction at common law is the service of process.1 To this extent the rules as to service define the limits of the court's jurisdiction. So, for a claimant to establish the jurisdiction of the English court over an overseas company2 he must be able to serve process on the company in accordance with the rules of service. The general rule is that an overseas company, like an individual, may be served with process in England if present within the jurisdiction.3 However, since a company is only a legal (not natural) person, it cannot be present in the same way as an individual. It has therefore been necessary for special rules to be laid down by which it can be determined whether or not an overseas company is present in England and therefore may be served with process here. Before 1992 those rules were contained in sections 691 and 695 of the Companies Act 19854 (the pre-1992 regime). However, in 1992 the law was amended and a separate provision was laid down in section 694A of the Companies Act 1985 to regulate the service of process on any overseas company with a branch in Great Britain (the 1992 regime).

Type
Shorter Articles, Comments and Notes
Information
International & Comparative Law Quarterly , Volume 48 , Issue 4 , October 1999 , pp. 921 - 936
Copyright
Copyright © British Institute of International and Comparative Law 1999

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References

1. Dicey & Morris on the Conflict of Laws (12th edn, 1993), pp.270–271Google Scholar; North, P. and Fawcett, J., Cheshire and North's Private International Law (12th edn, 1992), pp.182–183.Google Scholar

2. An “overseas company” is a company which is incorporated elsewhere than in Great Britain. See s.744 of the Companies Act 1985.

3. Where a person is not present in England, process may be served on the person abroad under Rules of the Supreme Court (RSC) Order 11.

4. Read together with s.744. These provisions consolidated the procedure laid down in the Companies Act 1948 (ss.407, 409 and 412), which repealed and replaced the provisions of the Companies Act 1929 (ss.344, 346 and 349). The 1929 Act itself repealed and replaced s.274(1) and (2) of the Companies (Consolidation) Act 1908, which in turn repealed and re-enacted s.35 of the Companies Act 1907.

Prior to 1907 there was no statutory provision in force which laid down the procedure for service on overseas companies. So, the common law rules applied. At common law the rule was that an overseas company could only be served within the jurisdiction if it carried on business at a place within the jurisdiction in such a way that it may be said to be resident here: Newby v. Van Oppen (1872) 7 Q.B.D. 293Google Scholar; Haggin v. Comptol D'Escompte de Paris (1889) 23 Q.B.D. 519Google Scholar; La Bourgogne [1899] P.1Google Scholar, aff'd [1899] A.C. 431Google Scholar; Okura & Co. Ltd v. Forsbacka Jernwerks Aktiebolag [1914] 1 K.B. 715.Google Scholar

5. Davies, P., Cower's Principles of Company Law (6th edn, 1997), p.128.Google Scholar

6. The Brussels Convention (1968) is the EC Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (implemented in the United Kingdom by the Civil Jurisdiction and Judgments Act 1982). The Lugano Convention (1988) is a parallel convention between EC member states and countries which were then members of EFTA. The Lugano Convention, the main provisions of which are almost identical to those of the Brussels Convention, was implemented in the United Kingdom by the Civil Jurisdiction and Judgments Act 1991. Those contracting States of the Lugano Convention which have since joined the EC (Austria, Finland and Sweden) will have to accede to the Brussels Convention.

The European Commission has adopted a draft Regulation on Jurisdiction, Recognition and Enforcement of Judgments in Civil and Commercial Matters. This Regulation will, when adopted by the Council of Ministers, replace the Brussels Convention.

7. Rome v. Punjab National Bank (No.2) [1989] 1 W.L.R. 1211.Google Scholar

8. [1989] 1 W.L.R. 1211, 1221.Google Scholar

9. Re Oriel Ltd [1986] 1 W.L.R. 180, 184.Google Scholar See also South India Shipping Corporation v. Export-Import Bank of Korea [1985] 1 W.L.R. 585Google Scholar; Cleveland Museum of Art v. Capricorn Art International SA [1990] 2 Lloyds Rep. 166.Google Scholar

10. Saab v. Saudi American Bank [1998] 4 All E.R. 382, 385–386.Google Scholar

11. In accordance with the principles laid down in Spiliada Maritime Corporation v.Cansulex Ltd [1987] 1 A.C. 460.Google Scholar

12. 89/666/EEC, and the Bank Branches Directive (89/117/EEC).

13. S.I. 1992/3179.Google Scholar

14. Paras 1 and 3 of the Schedule.

15. Where a company has more than one branch in Great Britain any process to be served on the company which is not in respect of the carrying on of the business of one branch rather than another is treated as served in respect of the carrying on of the business of each of its branches: s.694A(4) of the Companies Act 1985.

16. Clarkson, and Hill, , Jaffey on the Conflict of Laws (1997), pp.96–97.Google Scholar

17. CPR 6.2(2)(b) and (c).

18. Re Oriel Ltd supra n.9.

19. Consequently, the former method of serving process on a corporation under Ord.65 r.3 ceased to be applicable: The Theodohos [1977] 2 Lloyds Rep. 428.Google Scholar

20. Saab v. Saudi American Bank (1999).Google Scholar

21. Saab v. Saudi American Bank ibid, per Clarke LJ.

22. Saab v. Saudi American Bank ibid, per Clarke LJ.

23. Saab v. Saudi American Bank [1998] 4 All E.R. 382, 385.Google Scholar

24. Ibid., per Tuckey J.

25. Supra n.20, per Clarke LJ.

26. Supra n.20.

27. Art.53 of the Convention. And in order to determine the seat of a company the court shall apply its own rules of private international law (Art.53). For the English courts those rules are contained in s.42 of the Civil Jurisdiction and Judgments Act 1982.

28. S.42(3) of the Civil Jurisdiction and Judgments Act 1982.

29. The allocation of jurisdiction as between the separate jurisdictions in the United Kingdom (England and Wales, Northern Ireland, Scotland) depends on the provisions of Sched. 4 of the Civil Jurisdiction and Judgments Act 1982 which is modelled on the Brussels Convention itself. See Kleinwort Benson Ltd v. Glasgow City Council [1999] 1 A.C. 153.Google Scholar

30. Saab v. Saudi American Bank, supra n.2O.

31. If an overseas company has a branch in the United Kingdom it may be served in England only under S.694A or CPR 6.5(6).

32. As to which see Case 14/76 Ets A de Bloos SPRL v. Société en Commandite par Actions Bouyer [1976] ECR 1479Google Scholar; Case 33/78 Ets Somafer SA v. Saar-Ferngas AG [1978] ECR 2183Google Scholar; Case 139/80 Blanckaert and Willems PV BA v. Trost [1981] ECR 819Google Scholar; Case 218/86 SAR Schotte GmbH v. Parfums Rothschild SARL [1987] ECR 4905.Google Scholar

33. [1998] 4 All E.R. 382.Google Scholar

34. Ibid., 385.

35. Ibid., 385–386.

36. This is not the first time that United Kingdom law has come under attack for being incompatible with the Brussels Convention. The English courts, applying s.49 of the Civil Jurisdiction and Judgments Act 1992, exercise a general discretion to stay English proceedings on the grounds of forum non conveniens even where jurisdiction is derived from the Brussels or Lugano Convention if the appropriate forum is in a non-contracting State (Re Harrods (Buenos Aires) Ltd [1992] Ch. 72Google Scholar; The Nile Rhapsody [1994] 1 Lloyd's Rep. 382).Google Scholar This has attracted criticism from some academics, notably Cheshire, and North, , Private International Law (12th edn, 1992), pp.333–334.Google Scholar See also, Gaudemet-Tallon, H., “Le ‘Forum non Conveniens’, une Menace pour la Convention de Bruxelles? (A Propos de Trois Arre˚ts Anglais Récents)”, (1991) Rev. Crit. 491.Google Scholar

37. Although the question may still arise whether the discretion should be exercised. Indeed in Saab v. Saudi American Bank, supra n.10, even though it was held that there had been proper service under S.694A the court still considered the question whether the alternative forum (Saudi Arabia) was the more appropriate forum for the trial of the action. However, both the trial judge and the Court of Appeal came to the conclusion that England was an appropriate place for trial and so a stay of the proceedings on the grounds of forum non conveniens was denied.

38. Supra, n.20.

39. Supra n.32.

40. Para.11.

41. Supra n.32, 4914–4915.

42. E.g. Gothot et Holleaux, La Convention de Bruxelles (1985), p.56Google Scholar; Dicey, and Morris, , Conflict of Laws (Ed, Collins, 1993), p.366Google Scholar; Tebbens, H., Compétence Judiciairc et Exécution de Judgements en Europe (1993), p.99.Google Scholar

43. [1995] E.C.R. 1–961Google Scholar; (1995) Rev. Crit 770, note Droz.Google Scholar

44. Ibid., at para.20.

45. E.g. (1995) Droz, Rev. Crit. 770, at p.776.Google Scholar

46. Since, in such a case, Spain will also be the place where the obligation in question was to be performed.

47. [1996] I.L.Pr. 552.Google Scholar

48. It seems, but it is not clear from the judgment, that the contract was entered into directly with the Strasbourg office.

49. Soc Strafor v. Soc Comebo (1997) Rev. Crit. 577, note Muir Watt.Google Scholar

50. Ibid.

51. [1998] 4 All E.R. 382.Google Scholar

52. Ibid., 386. Emphasis in the original.

53. Ibid.

54. Saab v. Saudi American Bank, supra n.20, per Clarke LJ.

55. To the extent that the requirements of S.694A fall short of those of Art.5(5), service under the UK statute will not be enough to give the English courts jurisdiction. Any additional requirements of Art.5(5) must be satisfied in order for the English courts to have jurisdiction under that provision of the Convention.

56. Or some other provision of the Convention.