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STAY OF PARALLEL PROCEEDINGS AND THE

BRUSSELS I REGULATION

James McComish

The Cambridge Law Journal / Volume 73 / Issue 02 / July 2014, pp 270 - 273
DOI: 10.1017/S0008197314000737, Published online: 17 July 2014

Link to this article: http://journals.cambridge.org/abstract_S0008197314000737

How to cite this article:

James McComish (2014). STAY OF PARALLEL PROCEEDINGS AND THE
BRUSSELS I REGULATION. The Cambridge Law Journal, 73, pp 270-273
doi:10.1017/S0008197314000737

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 270 The Cambridge Law Journal [2014]

While the Court’s judgment is to be welcomed, in the absence of Treaty

change, it only comes as a second best solution.

VALIA BABIS

STAY OF PARALLEL PROCEEDINGS AND THE BRUSSELS I REGULATION

IF litigation arising from the same set of facts is pending in the courts of
two EU member states, which court has to give way? In Starlight
Shipping Co v Allianz Marine & Aviation Versicherungs AG; The
Alexandros T [2013] UKSC 70, [2014] 1 All E.R. 590, the somewhat sur-
prising view of the Supreme Court was that the answer will often be
“neither”. The proceedings arose from the loss of the Alexandros T off
the coast of South Africa. In 2006, her owners (Starlight) sued her insurers
in England. Those proceedings settled pursuant to Tomlin orders, and the
settlement agreements contained English exclusive jurisdiction clauses.
That, one might have thought, would be the end of the matter, but in
2009 Starlight launched a swathe of proceedings in Greece against the
insurers, reiterating the same allegations that had been raised and settled
in England. In 2011, the insurers applied to the English courts to enforce
the terms of the 2006 settlements, and brought new proceedings in
England for damages, an indemnity and declarations concerning the breach
of that settlement.
At least three sets of proceedings were therefore on foot: how were the
English courts to resolve the risk of conflicting judgments? Since the courts
were exercising jurisdiction under Council Regulation (EC) No 44/2001
(OJ 2001 L 12 p. 1) (“Brussels I Regulation”), questions of natural or ap-
propriate forum were irrelevant; vexatious relitigation could never lead to
the grant of an anti-suit injunction; and an exclusive jurisdiction clause
was no bulwark against prior proceedings in another forum. If justice
were to be achieved, it had to be done through the blunt lis pendens
rules in Arts. 27 and 28 of the Regulation.
At first instance, no argument was offered about Art. 27. Instead, Burton
J. considered that Art. 28 was applicable and that a stay should nonetheless
be refused: [2011] EWHC 3381 (Comm); [2012] 1 Lloyd’s Rep. 162. The
Court of Appeal reversed that decision, holding that the English proceed-
ings should be stayed pursuant to Art. 27, as they were “essentially the
same” cause of action as the Greek proceedings, which were prior in
time: [2012] EWCA Civ 1714; [2013] 1 Lloyd’s Rep. 217. Even if the
original 2006 proceedings were earlier than the Greek proceedings, the
enforcement of the settlement agreement was a new, subsequent, cause
of action.

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 C.L.J. Case and Comment 271

In turn, the Supreme Court reversed the Court of Appeal. Lord Clarke
(with whom Lord Sumption and Lord Hughes agreed) held that the
English and Greek claims were not mirror images of each other, and
were therefore not legally irreconcilable. The Court of Appeal had taken
too broad a view of what counted as the “same cause of action” for the
purposes of Art. 27. Since the English claim to enforce the settlement
agreement (including its indemnity, release, and jurisdiction clauses) was
contractual, and the Greek claim was delictual, the two proceedings lacked
“le même objet et la même cause”, to use the language of the French text
of the Regulation held by the CJEU to be generally applicable in
Case C-144/86, Gubisch Maschinenfabrik AG v Palumbo [1987] E.C.R.
4861, and Case C-406/92, The Tatry [1994] E.C.R. I-5439.
Moreover, his Lordship held that the Court of Appeal incorrectly
took into account the insurers’ reliance on the English settlement as a de-
fence to the Greek action. After the decision in Case C-111/01, Gantner
Electronic GmbH v Basch Exploitatie Maatschappij BV [2003] E.C.R.
I-4207, matters raised by way of defence can, so we are told, have no bear-
ing on whether Art. 27 is engaged. Thus, “[g]iven the fact that defences are
irrelevant, the analysis cannot simply involve a broad comparison between
what each party ultimately hopes to achieve”. Since the causes and objects
were different, Art. 27 did not oblige the English court to stay its proceed-
ings. So far as Art. 28 was concerned, while the claims were clearly
“related” and the English court was second in time, the existence of an
exclusive jurisdiction clause in favour of England was a “powerful factor”
in favour of refusing a stay on discretionary grounds. To the extent that the
English proceedings fell within Art. 28 and not Art. 27, they could therefore
continue.
Lord Neuberger and Lord Mance agreed with the disposition of the
appeals, but took a different view about the applicability of Art. 27 to the
insurers’ claim for a declaration that the claims in the Greek proceedings
had been released by the 2006 settlement agreement. Their Lordships
considered that – contrary to the majority – Art. 27 was applicable here.
In Lord Neuberger’s view, if the Greek court were to uphold Starlight’s
claim, and the English court were to grant the insurers a declaration that
that claim had in fact been settled, the two judgments would be logically
incompatible. This, said his Lordship, was conceptually different from
the insurers’ claim for an indemnity, which would only be commercially –
but not logically – inconsistent with any Greek judgment in favour of
Starlight. The former, but not the latter, aspect of the insurers’ claim there-
fore fell within Art. 27.
Lord Mance likewise considered that Art. 27 was engaged by the
claimed declaration of non-liability. The claims before the Greek and
English courts had the same “cause” because they were mirror images of
each other: the one asserted, and the other denied, the existence of liability.

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 272 The Cambridge Law Journal [2014]

Likewise, the proceedings had the “same object”, namely deciding the
question of liability for the wrongs alleged in Greece. Given the auton-
omous definition of “cause of action” in the Regulation, the reason for
the denial of liability (i.e. the existence of the settlement agreement)
was irrelevant. The disjuncture drawn by the plurality between the Greek
“tortious” and English “contractual” claims was therefore wrong as a matter
of principle.
The result reached by the Supreme Court is, with respect, practical
and just; yet practicality and justice are not hallmarks of the Brussels
I Regulation nor of its interpretation by the CJEU. Three unsatisfactory
aspects of the decision are worth noting. First, Lord Mance was surely cor-
rect that the majority’s narrow approach to the meaning of “cause of action”
is wrong. As the decision in the Tatry shows, Art. 27 cannot in fact be
avoided simply by artful pleading. There, an action in rem and an action
in personam were indeed held to be the same “cause”. The question
certainly cannot turn on domestic definitions of “contract” or “tort”. In
France, an action for professional negligence must be pleaded as a breach
of contract, yet if it were relitigated in England as a tort claim, it cannot be
treated as a different “cause of action” for the purpose of Art. 27. Moreover,
while Lord Neuberger’s distinction between “commercial” and “logical”
inconsistency is attractive from the point of view of the English courts, it
is not clear that this is so from the point of view of a third state in which
the English and Greek judgments might simultaneously be enforced. The
inevitable consequence of the Supreme Court’s approach is a heightened
risk of practically inconsistent judgments – the very thing the Brussels
I Regulation purports to avoid.
Second, the fundamental difficulty in the Alexandros T is the lack of pri-
ority given to jurisdiction clauses in the Regulation’s lis pendens rules.
Lord Clarke’s reference to the jurisdiction clause as a “powerful factor”
weighing against a stay under Art. 28 is entirely legitimate; yet one cannot
help but suspect that the existence of the clause was also a strong motiv-
ation for the majority’s narrow construction of Art. 27. The revised rules
on lis pendens in Art. 31 of the recast Brussels I Regulation (Regulation
(EU) No 1215/2012 (OJ 2012 L 351 p. 1)) – which oblige any courts
other than the chosen court to stay their proceedings – will solve the im-
mediate problem, but they might also have encouraged a less instrumental-
ist approach to the assessment of what counts as the “same cause of action”.
Finally, the decision casts unnecessary doubt on an important question
which will persist under the recast Regulation: namely, determining when
a court is “seised” if the pleadings are amended to include a new claim.
Lord Clarke considered that the “court first seised” meant the “court first
seised of the proceedings, not of particular claims within the proceedings”,
and that an amendment might therefore be related back to the time of
the original claim. His Lordship considered that the matter was not

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 C.L.J. Case and Comment 273

acte clair, and that a reference to the CJEU would be necessary if the
insurers persisted with their amended claims. With respect, the contrary
view – that the court is only “seised” of such a claim at the time of the
amendment and not earlier – is compelling as a matter of logic and practi-
cality. As Lord Mance pointed out, the text of the Regulation, the existing
case law and academic commentators “all point in one direction”. It is
therefore especially unfortunate that a topic of such practical importance
in cross-border litigation should now be overshadowed with doubt.

JAMES MCCOMISH

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